Evergrande shares volatile as trading resumes
STORY: Evergrande stock resumed trading on Tuesday (October 3) - and it’s been a wild ride for investors.
Shares in the embattled Chinese developer surged up to 42% from the open, but soon gave up much up of those gains.
Trading had been halted last Thursday (September 28), after a report that the Evergrande chairman had been placed under police watch.
The company later said that Hui Ka Yan was being investigated over unspecified crimes.
Once the top-selling Chinese developer, Evergrande has been embroiled in a mounting debt crisis.
Its problems deepened last week, when it said its main domestic unit was unable to issue new debt due to a probe by regulators.
That has complicated a plan to secure creditor support for restructuring.
And the clock is ticking.
Last week Reuters reported that a major offshore creditor group could support liquidation of the company if it doesn’t file a new debt plan this month.
Amid the turmoil, Beijing has taken steps to support the sector, with real estate making up about a quarter of China’s economy.
But investors around the world are watching closely, concerned over what might happen if the world’s most indebted developer goes under.
