Chinese Developers Slump as Shimao Bond Plunge Spooks Investors
- Trading halted in six of Shimao’s yuan bonds after tumble
- Selloff comes after Beijing’s easing moves boosted the sector
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A wave of selling swept through Chinese developers’ bonds and shares after the sudden plunge in a major property firm’s notes renewed concern over the health of the sector.
Shimao Group Holdings Ltd.’s dollar notes dropped as much as 12 cents on the dollar, with the selloff spreading to other company bonds including Sunac China Holdings Ltd. and KWG Group Holdings Ltd. Trading was halted in six of Shimao’s yuan bonds after they plunged, with one falling more than 50%. A Bloomberg Intelligence stock index of real estate firms slumped 2.8%, led by an 12% drop by Shimao.