Bond Woes in China Raise Concerns of Financial Meltdown

(Beijing) — Heightened volatility in China’s bond market — in part fueled by a recent bond default that roiled the market — is fueling concern about whether another financial meltdown is brewing similar to last year’s stock market rout.

Shenzhen-listed Sealand Securities sparked the turmoil last week after the emergence of online rumors— later proved true — that the midsize brokerage had refused to honor a bond transaction purportedly worth 10 billion yuan ($1.44 billion) with Lang Fang Bank.