Chinese Developers Sit Out Wider Asian Rally

Asian stocks extended a global rally, with a weaker yen helping Japan’s Nikkei close up 0.7%. Benchmarks in Hong Kong, South Korea, Indonesia and Singapore also rose, The Wall Street Journal reported. However, indexes in mainland China were little changed, after large gains Monday helped temper a recent rout. China’s developers have enjoyed years of robust growth, expanding aggressively to take advantage of cheap debt and a housing boom. But global investors have recently turned cautious on property companies, fearing deteriorating profitability and a possible cash crunch as Beijing tries to cool an overheating market. Beijing is tightening mortgage-lending criteria, investigating illegal property sales and moving to cap rising prices. Meanwhile, developers are finding it harder to borrow, and bond defaults are rising. Read more. (Subscription required.)