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Toyota Production Comes To A Screeching Halt In 2 Plants
Toyota Motor (7203.T), Japan’s biggest automaker, has suspended operations at three lines in two domestic assembly plants due to an accident at a supplier’s facility, a company spokesperson said.
Oil Steadies Amid Easing Venezuela Sanctions
Oil prices stabilized today after a more than USD 1 slide on Monday amid hopes the U.S. would ease sanctions on producer Venezuela and as Washington stepped up efforts to prevent an escalation of the war between Israel and Hamas.
Today’s News
Time is running out for Country Garden Holdings Co. to avert its first-ever public dollar bond default as the distressed developer faces an imminent end to a deadline for interest payment.
The developer is widely regarded as a symbol of China’s broader property debt crisis, missed the original deadline for the USD 15.4 million coupon on the note last month. The bond carries a 30-day grace period that ends by Oct 17-18, before a default can be called.
It will be the first major test for China’s former top developer after it warned last week that it will not be able to meet all its future offshore payment obligations, offering the strongest indication yet that it is set for a debt blowup and restructuring. Its payment struggles in recent months, along with its peer, Evergrande Group’s deepening woes are adding to signs that authorities’ rescue efforts are far from enough to curb the nation’s property crisis from intensifying.
Country Garden has until now managed to dodge its first major public bond payment failure and succeeded in rescheduling local debt in recent months. It said in a stock exchange filing last week that it has not made a due payment totaling HKD 470 million (USD 60 million) “under certain of its indebtedness”, without specifying.
An imminent default wouldn’t come as a surprise, given the developer’s dollar bonds are trading at deeply concerning levels at 4-6 cents on the dollar, indicating low expectations for debt recovery.
Other related news include:
Inevitable Default Looms As Woes Deepen
Country Garden Holdings Co. is set for a maiden default and debt restructuring, indicating that authorities’ rescue efforts are a far cry from elevating the nation’s ongoing property crisis.
China’s former top developer warned in a stock exchange filing Tuesday that it will not be able to meet all its future offshore payment obligations, including dollar bonds. Such non-payment may lead to relevant creditors demanding acceleration of payment or pursuing enforcement action, it added.
China Data Portrays Economy In Dire Need Of Support
China’s economic growth has undershot Beijing’s annual target for 2023 in the last quarter as subdued demands weighed on activity, a sign of its fragility as the government reportedly mulls over more stimulus.
Data due this Wednesday will likely show its gross domestic products have expanded by 4.5% in July-September as opposed to a year earlier — below the official full-year target of approximately 5%. GDP growth from the prior quarter likely picked up slightly. Authorities will also release data on industrial output, retail sales, investment and unemployment.
Bumpy Road Ahead For Liquidation
A hearing for the China Evergrande Group in a Hong Kong insolvency court later this month will lay bare the once unthinkable possibility of liquidating the property developer’s assets.
A wind-up order from Judge Linda Chan after the Oct 30 hearing would wreak havoc on the struggling company that is trying to finalize a restructuring plan to pay back its creditors. Any efforts to wind up the world’s most indebted developer — even if difficult to enforce in mainland China — would set a roadmap for other developers and creditors on how a liquidation of such magnitude may play out.
