China's Big Default Scares Are Giving Bond Investors Whiplash

China’s biggest default scares of 2019 have taken bondholders on some wild rides, underscoring both the risks and the opportunities for investors as more of the nation’s companies struggle to repay debt, Bloomberg News reported. At least three large Chinese borrowers -- Qinghai Provincial Investment Group Co., China Minsheng Investment Group Corp. and Beijing Orient Landscape & Environment Co. -- missed bond-payment deadlines last month only to come up with the cash shortly thereafter. A fourth issuer, Hong Kong Airlines Ltd., saw its dollar bonds plunge on repayment concerns in January but made good on a maturing note after reportedly securing help from China Development Bank. In all four cases, knee-jerk declines in the companies’ bonds gave way to at least partial recoveries. Dollar notes issued by Hong Kong Airlines have rallied 45 percent from their lows and CMIG’s have gained 13 percent. Read more

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