China Markets Open Lower After 4-Day Break For Mid-Autumn Festival Amid Evergrande Crisis

The stock markets in mainland China opened lower on Wednesday following the long weekend holiday for the Mid-Autumn Festival.

What’s Moving: The benchmark Shanghai Composite Index fell more than 1% in early trade but has pared losses and is down 0.4% at the time of writing. The Index closed almost 0.2% higher on Friday.

Shenzhen Component traded 0.87% lower at press time.

Why Is It Moving: Worries about the potential impact of China Evergrande Group’s EGRNF liquidity crisis on China’s financial system continued to weigh on the markets.

The world’s most indebted property developer is expected by analysts to default on a series of interest payments due on its debt, beginning on Thursday.

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Reuters reported that Evergrande’s main unit Hengda Real Estate said it will make a bond coupon payment on Thursday. The news helped soothe investors’ concerns about the company, which has more than $300 billion in liabilities.

Industrial and Commercial Bank of China Limited IDCBY is trading lower by almost 1.3% while China Construction Bank Corp. CICHY is declining 2.1% and China Petroleum and Chemical Corp. SNP is down almost 0.5%. Ping An Insurance (Group) Co. of China Ltd. PNGAY is down about 2.4%.

Shares of U.S.-listed Chinese companies that are also listed in Hong Kong closed mixed in U.S. trading on Tuesday after the major averages in the U.S. ended on opposite sides of the unchanged line. Investors turned cautious as they looked ahead to the U.S. Federal Reserve’s monetary policy announcement due on Wednesday.

Alibaba Group Holding Ltd. BABA  shares closed 0.9% lower, while electric vehicle maker Nio Inc.’s NIO shares ended lower by almost 0.8%.

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