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Australia stocks lower at close of trade; S&P/ASX 200 down 0.15%

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© Reuters Australia stocks lower at close of trade; S&P/ASX 200 down 0.15%

Investing.com – Australia stocks were lower after the close on Thursday, as losses in the Utilities, Industrials and Consumer Staples sectors led shares lower.

At the close in Sydney, the S&P/ASX 200 fell 0.15% to hit a new 52-week low.

The best performers of the session on the S&P/ASX 200 were Resolute Mining Ltd (ASX:RSG), which rose 10.42% or 0.03 points to trade at 0.26 at the close. Meanwhile, AP Eagers Ltd (ASX:APE) added 5.44% or 0.48 points to end at 9.30 and Appen Ltd (ASX:APX) was up 5.10% or 0.26 points to 5.36 in late trade.

The worst performers of the session were Link Administration Holdings Ltd (ASX:LNK), which fell 10.43% or 0.39 points to trade at 3.35 at the close. Inghams Group Ltd (ASX:ING) declined 4.44% or 0.12 points to end at 2.58 and Sims Metal Management Ltd (ASX:SGM) was down 4.05% or 0.65 points to 15.38.

Rising stocks outnumbered declining ones on the Sydney Stock Exchange by 877 to 575 and 390 ended unchanged.

Shares in Link Administration Holdings Ltd (ASX:LNK) fell to 52-week lows; losing 10.43% or 0.39 to 3.35. Shares in Inghams Group Ltd (ASX:ING) fell to all time lows; losing 4.44% or 0.12 to 2.58.

The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was down 3.36% to 21.41.

Gold Futures for August delivery was up 0.48% or 8.80 to $1,828.40 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in July rose 0.30% or 0.35 to hit $115.66 a barrel, while the August Brent oil contract rose 0.29% or 0.34 to trade at $118.85 a barrel.

AUD/USD was unchanged 0.65% to 0.70, while AUD/JPY fell 0.26% to 93.47.

The US Dollar Index Futures was up 0.30% at 105.25.

Stock Markets

Factbox-Major finance milestones as Hong Kong marks 25 years since handover

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© Reuters. FILE PHOTO: A general view of Two International Finance Centre (IFC), HSBC headquarters and Bank of China in Hong Kong, China July 13, 2021. REUTERS/Tyrone Siu/File Photo

HONG KONG (Reuters) – Hong Kong returned to China in 1997 after 156 years of British colonial rule. Here are some major milestones for the city’s financial markets:

HONG KONG DOLLAR TRADING BAND

The Hong Kong dollar was pegged to the U.S. dollar on October 17, 1983, with a trading band of between 7.75 and 7.85 per US dollar imposed since 2005. The Hong Kong Monetary Authority (HKMA), the city’s de-facto central bank, regularly enters the market to buy or sell the currency to keep it within the band.

DUAL HONG KONG AND MAINLAND LISTINGS

Industrial and Commercial Bank of China became the first company to execute an IPO simultaneously in Shanghai and Hong Kong in 2006 when it issued A-shares and H-shares to raise US$21.9 billion, the largest deal in the world at the time.

STOCK, BOND AND WEALTH CONNECT

Shanghai-Hong Kong Stock Connect was created in 2014 to provide mutual access between the equity markets of Hong Kong and mainland China. Two years later, the programme was expanded to Hong Kong and Shenzhen Stock Connect, which allowed mainland investors access to smaller companies in Hong Kong and international investors access to new economy companies listed in Shenzhen. The connect programmes now cover about 2000 stocks, according to Hong Kong’s Securities and Futures Commission (SFC). In May, China’s securities regulator agreed to include exchange-traded funds (ETFs) in stock connect programmes with Hong Kong.

In 2017, Bond Connect was launched to replicate the equity schemes and allow foreign investors to invest via Hong Kong in China’s multi-trillion bond market. The Northbound Bond Connect has become a major channel for foreign investors seeking access to China’s bond market. In September last year, China said it would permit its investors to trade offshore debt with the opening of the “Southbound” leg of its Bond Connect channel.

Wealth Management Connect launched in September 2021, linking China’s southern province of Guangdong with Hong Kong and Macau, to allow cross-border funds management. The programme enables residents of Hong Kong and Macau to buy mainland investment products sold by banks in the Greater Bay Area, while allowing residents of nine Guangdong cities to buy those sold by banks in the two offshore centres.

WEIGHTED VOTING RIGHTS

Hong Kong Stock Exchange announced in 2018 https://www.reuters.com/article/uk-hkex-regulation-idUKKCN1G70VS it would allow companies with dual-class shares – or weighted voting rights – if they are considered to be “innovative”, in a move designed to facilitate listings from emerging business sectors. The decision was described by the law firm Skadden as the most significant change to Hong Kong’s listing rules in 20 years.

WAVE OF SECONDARY LISTINGS

The weighted voting rights changes in 2018 prompted a wave of secondary – or homecoming listings – which kicked off with Alibaba (NYSE:BABA) Group in November 2019. The Jack Ma-founded e-commerce giant raised $12.9 billion in the deal that was the largest share sale in Hong Kong at the time for nine years. Since then, 18 companies have raised $42.3 billion, according to Refintiv data. The pace of homecoming listings has remained strong as Chinese companies trading in New York prepare contingency plans as U.S authorities press ahead with delisting firms that don’t meet regulators’ auditing requirements.

FUTURES

HKEX launched its MSCI A-share index futures product in 2021, an attempt to meet demand from investors in Chinese stocks for hedging tools at a time of surging volatility.

SPECIAL PURPOSE ACQUISITION CORPORATIONS (SPACs)

Hong Kong Stock Exchange allowed Special Purpose Acquisition Corporations (SPACs), known also as blank cheque companies, to start trading from January 1, 2022, in line with most other major markets in the world.

However, tight restrictions on the type of investors which could buy into the SPACs and banning retail participation dented demand for the products along with the current bout of market volatility.

Only two SPACs have listed since the start of the year.

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China Evergrande says winding-up lawsuit won’t impact restructuring

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© Reuters. The Evergrande Center of China Evergrande Group is seen amid other buildings in Shanghai, China, September 24, 2021. REUTERS/Aly Song

By Clare Jim and Sameer Manekar

Hong Kong (Reuters) -China Evergrande Group, the world’s most indebted property developer, on Tuesday said it will “vigorously” oppose a winding-up lawsuit filed against it, and that the petition will not impact its restructuring plan or timetable.

Evergrande confirmed the filing by investment holding firm Top Shine Global Ltd in Hong Kong for not fulfilling a financial obligation of HK$862.5 million ($109.91 million).

The developer has over $300 billion in liabilities and defaulted on its offshore debt last year. It expects to announce a preliminary restructuring plan by the end of July.

In a stock exchange filing on Tuesday, it said, if wound up, any disposition of property directly held, including assets and shares, will be void unless the court grants a validation order.

In such a scenario, it said, any transfer of shares by shareholders or potential investors on or after June 24, when the petition was filed, would be void.

Trading of Evergrande shares has been suspended since March 21 as the firm was unable to publish financial results on time, and because unit Evergrande Property Services Group Ltd said it was is investigating how banks seized 13.4 billion yuan ($2.00 billion) in deposits that had been pledged as security for third-party guarantees.

On Monday, a Top Shine executive told Reuters his firm filed the petition because Evergrande had not honoured an agreement to repurchase shares it bought in Fangchebao (FCB), Evergrande’s online real estate and automobile marketplace.

The executive said Top Shine bought 0.46% of FCB for HK$750 million in March last year ahead of an initial public offering (IPO), and that Evergrande agreed to repurchase the shares with a 15% premium if an IPO did not materialise by April 8, 2022.

($1 = 7.8472 Hong Kong dollars)

($1 = 6.6969 Chinese yuan renminbi)

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Toshiba board gains two directors from activist hedge funds

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© Reuters. FILE PHOTO: Toshiba logos are pictured at Toshiba Corp’s annual general meeting with its shareholders in Tokyo, Japan, June 25, 2021. REUTERS/Kim Kyung-Hoon/File Photo

TOKYO (Reuters) -Toshiba Corp shareholders endorsed two board directors from activist hedge fund investors at its annual general meeting on Tuesday – an inclusion that is expected to add momentum to its exploration of potential buyout deals.

Nabeel Bhanji, a senior portfolio manager at Elliott Management, and Eijiro Imai, managing director at Farallon Capital Management were elected, as was Akihiro Watanabe, an executive from boutique U.S. investment bank Houlihan Lokey (NYSE:HLI), who becomes chairman of its board.

All in all, seven new board directors were appointed and six were reappointed.

The appointments of Bhanji and Imai were not without controversy with one board member publicly expressing concern that the board may become too skewed towards the input of activist investors.

Toshiba (OTC:TOSYY) said this month it had received eight initial buyout proposals to go private as well as two proposals for capital alliances that would see it remain listed.

Sources have told Reuters that at least one bidder is considering offering up to 7,000 yen per share to take the company private, valuing a potential deal at up to $22 billion.

Toshiba’s shares closed at 5,707 yen on Monday, up 21% since the end of the year and giving it a market value of $18 billion.

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