China’s Property Shares Rally on Beijing’s Economic Support

Following a dramatic selloff in the previous session, investors flocked to China’s property developers’ shares and bonds on Tuesday after regulators promised to increase support for the troubled industry.

Following four months of substantial losses, the recent increase put the nation’s real estate sector indices on track for their first monthly gain. The benchmark CSI 300 Real Estate gained by 8%, while the Hang Seng Mainland Properties Index in Hong Kong increased by 14%.

The Hong Kong-listed real estate behemoth Country Garden and its management subsidiary Country Garden Services recovered by 18% and 26.5%, respectively, more than compensating Monday’s severe falls.

The May 2025 dollar bond issued by Country Garden formed 21.675 cents on the dollar as opposed to 15 cents on Monday night. A Shenzhen-traded bond increased by 44% to 33.6 yuan, while its Shanghai-traded bond increased by 25% to 38 yuan.

According to a report by Debtwire, the company has hired the accounting firm KPMG to do due diligence on its assets and obligations. Requests for comment from Country Garden did not immediately receive a response.

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China’s Commitment to Increase Policy Assistance

The broad surge was fueled by China’s top leaders’ commitment to increase policy assistance for the economy amid a grueling post-COVID recovery and a focus on increasing domestic demand, which they announced on Monday.

The Communist Party’s top decision-making body, the Politburo, stated that for the real estate industry, it is crucial to quickly adjust to large changes in market supply and demand.

Investors seized on one change in tone in particular because they believed it would indicate that additional property stabilization activities were about to be taken, despite the fact that little specifics of the support measures were revealed.

Gains in the industry were widespread; for example, shares of major developers Seazen Group and KWG Group both rose by more than 25%, while Longfor Group’s shares increased by 23%.

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