Property stocks up after share financing rules eased
China's property shares jumped on Friday after state media said authorities will ease share financing rules for certain real estate-related firms, fuelling hopes of more measures to aid the sector. The China Securities Regulatory Commission will allow certain companies with small property interests to raise money by selling A-shares, but the proceeds cannot be invested in the real estate business, China Securities Journal reported. For eligible companies, real estate must not be their core business, and should not contribute more than 10 percent of their profit, according to the article. China has barred its property firms or property-related firms from financing via the domestic A-share market since end-2018, including both IPOs and additional or follow-up share sales. Some companies with real estate-related businesses, including Zhongtian Financial Group, Jinan High-tech Development and Shenzhen New Nanshan Holding Group, saw their shares surge above 5 percent. Analysts say the move could aid companies which are having difficulty obtaining financing via other channels, and allow them to invest in other areas of the economy. China's central bank and banking regulator have taken steps to ease liquidity pressure in the property sector, where many companies are suffering from slumping investment and sales. Beijing is also seeking to stabilise markets during the ongoing communist party congress. (Reuters)