Sentiment remains sour as Evergrande nears bankruptcy

By Peter Bukov|

Published: September 20 2021, 08:55 GMT+0

Sentiment remains sour as Evergrande nears bankruptcy

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Stocks crashed on Monday, undermined by very bearish sentiment, sending EU indices down 2% during the London session. US indices were nearly 1% lower. 

The Chinese real estate giant Evergrande will likely default this week, possibly causing some tremors in the financial markets as several US banks have notable holdings of Ever bonds. 

The company is scheduled to pay 83.5 million USD of interest on September 23 for its offshore March 2022 bond. Then, it has another 47.5 million USD interest payment due on September 29 for March 2024 bonds.

However, Evergrande is scheduled to pay interest on bank loans TODAY, with a one-day grace period. In other words, should it fail to arrange an extension of today’s payments, it could be in technical default as soon as Tuesday.

Should the company go bankrupt, it could spill into other markets, affecting banks and investors across the globe. 

From other news, precious metals erased their daily losses as silver tested 22 USD and are advancing now, despite negative sentiment and stronger USD. Silver is forming a nice daily pin bar, and if the price closes the day around the current levels, it could be a strong bullish signal.