China developer stocks headed to lowest level in 12 years
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The news: China property stocks could be headed to their lowest levels since 2011, according to Bloomberg, which has also reported that the billionaire chairman of the country's most indebted developer has been placed under police surveillance.
The numbers: A Bloomberg Intelligence gauge of developer shares fell 3.7% on Wednesday, dragged down by a 55% drop in CIFI Holdings, which resumed trading after a multi-month suspension. The gauge is now down roughly a third in 2023, performing significantly worse than the Hang Seng China Enterprises Index, which has lost
The context: The news came as the billionaire chair of China's beleaguered developer Evergrande was placed under police surveillance. Hui Ka Yan, who founded Evergrande in 1996, may not be charged with a criminal offence, Bloomberg reported, but has been placed under "residential surveillance" at a designated location. Evergrande is the world's most indebted property developer, and its debt woes and recently stalled restructuring program have been at the centre of a liquidity crisis in China's property sector.
