Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Aïda Amer/Axios

China Evergrande’s debt problems aren’t an anomaly. Signs of stress are piling up in China’s real estate development sector, and more companies are signaling they may not be able to pay back their debt.

Driving the news: Fellow builder Modern Land asked its bondholders if it could delay a bond payment by three months, and Sinic said it will likely default next week, Reuters reports.

Why it matters: Widespread distress in the Chinese property market could bleed into other areas of its massive economy, as well as negatively impact the global markets for commodities and raw materials.

  • Watch for a domino effect among the builders.
  • Each company that acknowledges it can’t make debt payments makes it a little more palatable for others to join their ranks, Aayush Sonthalia, portfolio manager for emerging markets debt at PGIM Fixed Income, tells Axios.

State of play: Repayment is in doubt for any bonds issued by Chinese property developers that have lower credit ratings and an upcoming maturity, Sonthalia adds.

  • One reason: Chinese banks have tightened their lending standards. If a company doesn’t pass the “three red lines” test, it may not be able to get money to refinance.
  • On top of that, weak property sales data was just released. That's not a good sign for the developers’ ability to shore up their balance sheets.

The impact: The sell-off across the bond market has been broad. Even higher-quality investment-grade bonds backing Chinese developers are now trading in the 80 cents on the dollar area, Santhalia says.

What we're watching: The Chinese government's next move.

  • "Our view is that by the end of this year, we're going to see some further loosening of monetary conditions and possibly some fiscal support as well. The economy is so dependent on the sector ... they don't want a complete collapse," Santhalia adds.

Go deeper

China's economic growth slows

A worker assembles heavy truck engines in Hangzhou in eastern China's Zhejiang Province, on Monday. Photo: Long We/Costfoto/Barcroft Media via Getty Images

China's economy grew 4.9% in the third quarter of 2021 compared with a year earlier, the country's National Bureau of Statistics announced Monday.

Why it matters: The gross domestic product growth in the July-September period in the world’s second-largest economy marked the "weakest pace since the third quarter of 2020 and slowing from 7.9% in the second quarter," Reuters notes.

Yellen: Treasury will take "extraordinary measures" until Dec. 3 debt limit deadline

Janet Yellen. Photo: Samuel Corum/Bloomberg via Getty Images

Treasury Secretary Janet Yellen warned congressional leaders in a letter Monday that the Treasury will take "extraordinary measures" to manage its cash and not exceed the debt limit through Dec. 3, the earliest deadline for lawmakers to once again raise the debt limit or risk a default.

Driving the news: Congress last week averted a government default by raising the borrowing cap by $480 billion, after a protracted partisan battle.

36 mins ago - World

Biden's ambassador nominee: "China is not an Olympian power"

Nick Burns testifying before the Senate Foreign Relations Committee. Photo: Sarah Silbiger/Bloomberg via Getty Images

President Biden's nominee to serve as ambassador to China delivered a stark assessment of the challenges the U.S. faces in confronting Beijing, but stressed that the rising superpower is "not all-powerful" and the West retains "substantial" advantages.

The big picture: Nicholas Burns, a retired career diplomat and former U.S. ambassador to NATO, used his confirmation hearing Wednesday to echo the growing bipartisan consensus that China poses "the greatest threat to the security of our country and the democratic world" in the 21st century.