HONG KONG: Most Asian markets dropped Friday following a broadly healthy week, with traders hoping for fresh Chinese measures to help the country’s troubled property sector after officials urged banks to provide support.
Wall Street was closed for the Thanksgiving break, meaning investors had few catalysts to drive buying, while oil was in focus after OPEC chose to delay a key meeting sent rates sliding, AFP reported.
Equities have surged in recent weeks on optimism the Federal Reserve will not hike interest rates again in this cycle as inflation heads south and the economy shows signs of easing without causing recession worries.
And while minutes from the most recent policy meeting of the bank echoed warnings from decision-makers that borrowing costs will potentially stay elevated for some time, there is hope that they will slash in 2024.
With traders taking a break, many markets were mixed in Asia on Friday.
Hong Kong led the losses, having surged over the week, while Seoul, Singapore, Shanghai, Taipei, Jakarta and Bangkok were also down.
Tokyo surged as dealers caught up with Thursday’s Asian advance, while the yen rose against the US dollar as Japanese inflation jumped again, adding to bets the central bank will shift from its ultra-loose monetary policy.
Wellington and Manila edged higher. Mumbai and Jakarta were flat.
Investors keep tabs on China
Investors are keeping tabs on China after authorities urged banks to provide help to the beleaguered property sector, which makes up a huge part of the world’s second economy.
The Chinese parliament on Wednesday released a report urging for lenders to do more for the industry, with the head of the People’s Bank of China stating they should step up help to enact the “guaranteed delivery of buildings”.
It was also reported that they were also weighing a plan that would allow banks to offer developers unsecured loans for the first time.
That came after a report saying a draft list of companies eligible for bank support had been drawn up.
The measures suggest the government is lasering in on a debt crisis that threatens to take down some of China’s biggest property firms, including Country Garden and Evergrande, and hammer the economy.
Jian Shi Cortesi, of GAM Investment Management, said that the property developer debt problem will be solved sooner or later.
He said that if this measure on unsecured loans is not enough, we will see more support next year.
