CHINA EVERGRANDE GRO

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Australia shares end higher as China Evergrande dodges default

09/22/2021 | 03:42am

* Miners, energy stocks lead gains

* China Evergrande will avoid default on Thursday

* NZX 50 end 0.3% higher

Sept 22 (Reuters) - Australian shares ended higher on Wednesday in line with other markets, after troubled developer China Evergrande Group assured it would avoid default, dousing investor worries of an imminent crisis unleashing global financial chaos.

The S&P/ASX 200 index climbed 0.32% to close at 7,296.9, driven by energy and mining stocks. The benchmark closed 0.4% higher on Tuesday.

China Evergrande's main unit said it negotiated a deal with bondholders to settle interest payments on a domestic bond.

"Evergrande's decision gave some respite to the jittery markets that had been on edge in recent days over the potential default of the property developer," said Kunal Sawhney, chief executive officer of Kalkine Group.

It also appears to have provided some support in recouping losses in the iron ore price, he added.

Major miners jumped 2.19%, as the prospect of a major hit to demand for materials from China's real estate sector appeared to diminish.

Miner Mount Gibson Iron Ltd led gains on the sub-index, climbing 11.63%, followed by metals and electronics recycling firm Sims Ltd jumping 6.14%.

Energy stocks rose 2.25% tracking an uptick in oil prices, as industry data showed U.S. crude stocks fell more than expected last week in the wake of two hurricanes, highlighting tight supply as demand improves.

Heavyweights Worley Ltd and Beach Energy Ltd led gains on the sub-index, advancing 5.6% and 5.1%, respectively.

Buy-now-pay-later firm Zip Co Ltd advanced 5.6% after the company said it had entered the Indian market by investing $50 million in India's ZestMoney.

On the other hand, financial stocks fell 0.6% with the country's second largest lender Westpac skidding 1.2% after scrapping the sale of its Pacific businesses to Kina Securities, after the Papua New Guinea's competition regulator blocked the sale.

New Zealand's benchmark S&P/NZX 50 index rose 0.3% to end at 13,215.8. (Reporting by Riya Sharma in Bengaluru; Editing by Rashmi Aich)

© Reuters 2021
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