Hong Kong Perpetual Bonds Slump in Sign of China Property Contagion

(Bloomberg) --Perpetual dollar bonds sold by several Hong Kong-based companies have recently suffered their largest weekly declines in years, a sign of contagion from China’s property sector woes.

Notes guaranteed by New World Development Co. — one of Hong Kong’s most indebted real estate companies — have tumbled more than 10 cents this week, extending last week’s record losses of as much as 17 cents, according to prices compiled by Bloomberg. One bond is at a record low of 44.6 cents to the dollar while others are near last year’s bottom. Perpetuals backed by New World have lost 15% this week, the worst performer in a Bloomberg index of Asia high-yield dollar notes.