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Global stocks rebound on Evergrande boost

23 Oct 2021 00:00:00 | Update: 22 Oct 2021 22:46:31
Global stocks rebound on Evergrande boost

European and Asian stock markets mostly rebounded Friday as risks of contagion from troubled Chinese property giant Evergrande eased, while a record-breaking overnight lead from Wall Street provided support.

“Equity markets are back on the rise as investors shrug off their recent concerns,” noted Geir Lode at investment manager Federated Hermes.

Evergrande has made a key offshore interest payment a day ahead of a weekend deadline, Chinese state media said Friday, averting a default for now.

The crisis at one of the nation’s biggest property developers, which is drowning in $300 billion of debt, has hammered investor sentiment and fuelled fears of a spillover into the wider economy.

Evergrande’s share price jumped more than four percent in Hong Kong, though that came a day after a drop of more than 12 percent sparked by its announcement that the planned sale of its property services unit had fallen through.

In foreign exchange Friday, the British pound briefly hit a 20-month high versus the euro on increased expectations that the Bank of England will lift its main interest rate next month to combat high inflation.

The single currency took a knock also from a survey showing the eurozone economic recovery losing steam.

“The ongoing pandemic means supply chain delays remain a major concern,” warned Chris Williamson, chief business economist at IHS Markit which carries out the purchasing managers’ index measuring corporate confidence.

Elsewhere, bitcoin fell as profit-takers moved in after the digital currency hit a record $66,976 this week.

The world’s leading cryptocurrency has taken another step towards mainstream status as bitcoin forayed onto Wall Street.

A bitcoin futures exchange-traded fund, a type of financial instrument, launched this week on the New York Stock Exchange.