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Investing.com – Asia Pacific stocks were down on Monday morning. Investors in the region continued to sell off shares as concerns about China Evergrande Group’s (HK:3333) debt situation continues.
Japan’s Nikkei 225 slid 1.83% by 9:39 PM ET (1:39 AM GMT) as markets re-opened after a holiday. The Bank of Japan will hand down its policy decision on Wednesday.
In Australia, the ASX 200 edged down 0.11%, with the Reserve Bank of Australia releasing the minutes from its latest meeting earlier in the day.
Hong Kong’s Hang Seng Index fell 0.79%.
Korean and Chinese markets were closed on Tuesday.
Treasuries retained an advance ahead of the U.S. Federal Reserve’s latest policy decision, which will also be handed down on Wednesday. Investors will be looking for clues about the central bank’s schedule for asset tapering and interest rate hikes.
Officials including Fed Chairman Jerome Powell, Governor Michelle Bowman and Vice Chairman Richard Clarida will discuss the economic recovery from COVID-19
Across the Atlantic, the Bank of England will hand down its policy decision on Thursday.
In Asia Pacific, concerns about whether China Evergrande Group will be able to pay its $300 billion of liabilities. The company has an $83.5 million interest payment for its March 2022 bond due on Thursday and a second $47.5 million interest payment due on Sep. 29 for its March 2024 notes.
“Markets are clearly having some angst on the potential spillover effects from Evergrande, along with some nervousness over the Fed’s September meeting,” Cornerstone Wealth chief investment officer Cliff Hodge told Bloomberg.
“We’ve been in the camp that we’re overdue for a correction, something in the 5%-10% range that is a buyable pullback. At the moment, we’re not worried about a market crash. The Fed and Evergrande are not new.”
The Chinese property sector is one of several facing tightened restrictions as part of President Xi Jinping’s “common prosperity” initiative. It comes amid fresh COVID-19 outbreaks in the country denting the economic recovery and the prospect of reduced policy support from the People’s Bank of China.
