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Dow Jones Newswires: Chinese developer CIFI shares dive amid default concerns

Shares of CIFI Holdings (Group) Co
884,
-29.13%
.
fell sharply on Wednesday, following reports that an entity related to the Chinese developer had missed a debt payment.

The stock fell as much as 29% and was last down 27% at HK$0.93. That would put CIFI on track for its worst-ever one-day drop.

The selloff came after a widely-circulated media report claimed that a company controlled by CIFI has missed payment on a debt product. Credit markets data provider Debtwire later reported that CIFI is in talks to extend its deadline on repayment for a trust product due Tuesday, citing unnamed sources.

CIFI didn’t immediately respond to a request for comment.

CIFI was one of several developers approved by Beijing to sell new bonds since the liquidity crisis in China’s real estate industry worsened in 2021, and has a reputation for being relatively resilient within the sector. Any defaults by CIFI would thus be a significant hit to the already-fragile sentiment in China’s real estate market, analysts say.

“This is very important, because CIFI hadn’t missed payment before,” said a Hong Kong-based property equities analyst. “The first miss is always crucial.”

If reports of a missed payment prove true, it would be a sign that even the better-quality private developers are beginning to face problems, he said.

Write to Yifan Wang at yifan.wang@wsj.com

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