While China Evergrande property development group honored its local debt repayment on Thursday, investors remain in limbo.
They have received no information on the indebted company’s offshore coupon payment of $83.5 million, which was due on Thursday.
Although there are talks of a potential restructuring of the company debt in an imminent deal, with the Chinese government looking to take over control of Evergrande, nothing is officially confirmed, thus far.
Further, bondholders are eagerly awaiting an update on a $47.5 million payment due next week, which also has a grace period of 30 days before it can be called a default.
On Thursday, Bloomberg Law had reported that Chinese regulators had asked Evergrande to avoid a near-term default, citing unnamed people familiar with the matter.
Meanwhile, the Wall Street Journal (WSJ) reported that China is asking its local governments to prepare for the potential default of Evergrande.
Market reaction
Markets are cautiously optimistic amid looming Evergrande risks, hawkish Fed and BOE verdicts. The Asian equities are a mixed bag.
The S&P 500 futures are almost unchanged on the day while AUD/USD is battling 0.7300, at the time of writing. Meanwhile, the US dollar is attempting a bounce from the previous slump.
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