Hong Kong’s Hang Seng index drops 2% amid Evergrande trading halt

SINGAPORE — Asian markets were mixed in Monday trade, with the Hang Seng index in Hong Kong tumbling more than 2% following its return from a Friday holiday.

Trading in shares of China Evergrande was halted, as investor concern surrounding the indebted property developer returned.

Trading in the shares of Evergrande Property Services was also halted, with the firm saying in an exchange filing that there’s an impending announcement regarding a “possible general offer for the shares of the company.”

At the same time, the shares of another Chinese property developer Hopson were also suspended. Hopson said in a filing that it has halted its shares pending a “major transaction” under which it has agreed to acquire the shares of another company.

Investors continued to monitor the situation surrounding the debt worries of Evergrande, which has missed two bond interest payments in the past weeks.

“Evergrande default related stress may return to the fore as a dollar note worth USD260mn issued by Jumbo Fortune Enterprises, guaranteed by Evergrande, effectively matures today,” Mizuho Bank wrote in a Monday note. “Nonpayment would constitute a default.”

Meanwhile, shares in Asia-Pacific were mixed after Merck announced its new Covid oral antiviral treatment that cuts the risk of hospitalization or death.

In Japan, the Nikkei 225 shed 1.42% while the Topix index dipped 0.92%.

Australian stocks jumped, with the S&P/ASX 200 up 0.93%.

MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.34%.

Merck and Ridgeback Biotherapeutics announced Friday they’ve developed a drug which reduces the risk of hospitalization or death by around 50% in Covid patients. If authorized by regulatory bodies, the drug could be the first oral antiviral medicine for Covid.

The companies plan to seek emergency authorization for the antiviral Covid treatment after the medicine showed “compelling results” in clinical trials.

Markets in China are closed for most of this week for a holiday and are set to reopen on Friday. South Korean markets are also closed on Monday for a holiday.

Currencies and oil
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 94.099 after a recent decline from above 94.4.

.N225 Nikkei 225 Index *NIKKEI 28476.45 -294.62 -1.02
.HSI Hang Seng Index *HSI 24079.61 -496.03 -2.02
.AXJO S&P/ASX 200 *ASX 200 7269.1 83.6 1.16
.SSEC Shanghai *SHANGHAI 3568.17 31.87 0.9
.KS11 KOSPI Index *KOSPI 3019.18 -49.64 -1.62
.FTFCNBCA CNBC 100 ASIA IDX *CNBC 100 9894.21 -61.25 -0.62
The Japanese yen traded at 111.04 per dollar, stronger than levels around 112 seen against the greenback last week. The Australian dollar changed hands at $0.7261 following a bounce late last week from around $0.72.

Oil prices were lower in the afternoon of Asia trading hours, with international benchmark Brent crude futures down 0.37% to $78.99 per barrel. U.S. crude futures shed 0.42% to $75.56 per barrel.

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