The US labour market showed signs of a steady slowdown in October, with job openings increasing moderately and layoffs declining, according to the latest Job Openings and Labor Turnover Survey (JOLTS) report released by the Bureau of Labor Statistics on Tuesday. Job openings, a key indicator of labour demand, rose by 372,000 to 7.744 million at the end of October. However, the September figures were revised downward to 7.372 million from the initially reported 7.443 million. Economists polled by Reuters had anticipated 7.475 million vacancies. Labour Market Dynamics While job openings increased, hires dropped by 269,000 to 5.313 million, and layoffs fell by 169,000 to 1.633 million. These figures suggest a gradual cooling of the labour market rather than a sharp contraction. Hurricanes and strikes also impacted October’s labour market data. Rebuilding efforts in storm-affected regions and the resolution of strikes at Boeing and another aerospace company are expected to contribute to a ...
Hong Kong property developer New World Development has secured two onshore loans totaling 1.4 billion yuan (US$193 million) this month to further reduce its funding costs, according to a source with direct knowledge of the matter.
Key Takeaways:
Loan Details:
- 12-Year Loan: 1 billion yuan at an interest rate of 3.1%.
- 15-Year Loan: 400 million yuan at an interest rate of 3.15%.
Financial Strategy: The new loans are part of New World's strategy to lower funding costs amidst high debt ratios in Hong Kong's property sector. The company declined to comment on the loan details.
De-Leveraging Focus: New World has been under scrutiny for its de-leveraging plan, given its high debt ratios. Despite some perpetual and longer-dated bonds trading at distressed levels, many have recovered from last year's lows.
Market Context: Banks in Hong Kong are reducing their exposure to the commercial real estate sector due to falling valuations and occupancy rates, leading to higher lending rates. The new yuan loans are pledged to New World's flagship K11 projects in mainland China.
Recent Financial Moves:
- Last month, New World announced an increase in yuan loans to reduce overall financing costs, raising two onshore loans totaling 2.6 billion yuan in the first six months.
- Including the new loans and other offshore refinancing, the developer has completed HK$10 billion (US$1.28 billion) in loan arrangements and debt repayments in July, following US$4.5 billion completed in the first half of the year.
Rising Financing Costs: New World reported earlier this year that financing costs from continuing operations rose 17% in the six months ended December 2023 to HK$2.5 billion due to increased interest rates.
New World's strategic move to secure yuan loans highlights its ongoing efforts to manage debt and reduce financing costs amidst a challenging property market.
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