WWD : Everything to Know About the Louis Vuitton and Nike Air Force 1 Virgil Abl

Everything to Know About the Louis Vuitton and Nike Air Force 1 Virgil Abloh-designed Sneaker Collection
The nine-piece collection will be available to purchase starting Tuesday.

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Louis Vuitton and Nike are continuing their celebration of Virgil Abloh with one of the year’s biggest fashion collaborations.
The two brands are gearing up to release a new collection of the coveted Louis Vuitton and Nike “Air Force 1” sneakers created by the late designer, who was the design house’s men’s artistic director. Abloh died in November after a private two-year battle with cancer.
The collection first debuted in June 2021 at Louis Vuitton’s men’s spring 2022 show. In February, 200 pairs were sold exclusively at Sotheby’s, which auctioned the sneakers to benefit Abloh’s “Post-Modern” Scholarship Fund. The auction generated $25.3 million. Louis Vuitton and Nike also celebrated the collection in May with an exhibit in New York City.

Here, WWD rounds up everything you need to know about the Louis Vuitton and Nike “Air Force 1” Virgil Abloh-designed sneaker collection.

When was the Louis Vuitton and Nike “Air Force 1” Virgil Abloh-designed sneaker collection revealed?
Louis Vuitton and Nike first debuted the “Air Force 1” sneakers designed by Abloh at the brand’s men’s spring 2022 show.
What is the inspiration behind the sneaker collection?
Abloh was inspired by “Amen Break,” a drum break in the 1969 song by The Winstons, which is one of the most recognizable samples in hip-hop and jungle music. Abloh compared the drum break to the Air Force 1 sneaker, as the style was first introduced in 1982 and was a popular sneaker in New York’s hip-hop scene.
“The Air Force 1 is a sample like the ‘Amen Break,’” Abloh said in a statement provided by Louis Vuitton. “A T-shirt is an ‘Amen Break,’ a suit is an ‘Amen Break.’ We’re all iterating on the same ideas. But, in my canon, the Air Force 1 puts the edge on the blade. This object happened way before me, but to get to a context where it’s adjacent to the T-shirt and the suit, its logic has been 40 years in the making.”
What do the Louis Vuitton and Nike “Air Force 1” sneakers look like?
The nine-piece sneaker collection includes a variety of colors and design elements. The collection includes all-white and all-black sneakers embossed with the Louis Vuitton logo, a white checkered version featuring graffiti-style art, a metallic gold style and a multi-colored style featuring a silver chrome toe, among others.
When is the sneaker collection available for purchase?
The Louis Vuitton and Nike “Air Force 1” sneaker collection will be available to purchase starting Tuesday.
What is the price range for the Louis Vuitton and Nike “Air Force 1” sneakers?
Prices for the collection range from $2,750 to $3,450.
How can I buy the Louis Vuitton and Nike “Air Force 1” sneakers?
The collection will be available to purchase through Louis Vuitton’s website.

WSJ : Parts of U.K. Forecast to Hit 100 Degrees Fahrenheit

Parts of U.K. Forecast to Hit 100 Degrees Fahrenheit
Extreme heat warning triggers national emergency alert level

A heat wave set to hit the U.K. has prompted the country’s first red extreme heat warning, triggering a national emergency alert level.

Temperatures in coming days are expected to exceed 100 degrees Fahrenheit in some parts of the U.K., a country where umbrellas, gray skies and mild temperatures are comfortably familiar.

“I can say that the extreme heat we are forecasting right now is absolutely unprecedented,” said Penny Endersby, chief executive of the Met Office, the country’s national weather service.

“Here in the U.K., we’re used to treating a hot spell as a chance to play in the sun. This is not that sort of weather,” Ms. Endersby said in a video. “Our lifestyles and our infrastructure are not adapted to what is coming.”

The hottest weather is expected on Monday and Tuesday in parts of central, northern, eastern and southeastern England, said the Met Office. But high temperatures are also forecast for much of Wales and parts of southern Scotland.

It is the first time the Met Office has forecast temperatures of 40 degrees Celsius, or 104 degrees Fahrenheit, in the U.K. The country’s current record of 38.7 degrees Celsius was set in July 2019, at the Cambridge Botanic Garden.

On Friday, some models showed a 50% chance of maximum temperatures exceeding 40 degrees Celsius in isolated parts of the U.K. Officials have warned of possible disruptions to trains and roads, and urged people in England and Wales to only travel if necessary. The National Health Service said the hot temperatures were dangerous, especially for older and disabled people, and encouraged people to check in on others.

Homes with air-conditioning systems are rare in Europe and the U.K. Many buildings are centuries old and rely on heavy stone walls to insulate their interiors from hot air.

Supermarket chain Aldi said it had its biggest sales of ice cream in the U.K. in one day this past Monday. Sales of electric fans and deodorant are reaching record levels, the company said.

Swaths of Europe are already experiencing an intense heat wave this summer, with the temperature in some parts of Portugal reaching 115 degrees Fahrenheit on Wednesday, according to the Portuguese Institute of the Sea and Atmosphere. It was the highest temperature recorded by the agency.

Firefighters in the country are battling blazes, and the Portuguese government on Thursday extended a state of emergency to Sunday.

Heat waves have become more frequent in Europe, with record temperatures in some places becoming an almost yearly phenomenon. In 2003, soaring temperatures killed more than 70,000 people across 16 countries, according to a 2008 report. Some 15,000 of those deaths came in France alone, many of them among the elderly.

The long-term trend of rising global temperatures is being driven by greenhouse-gas emissions, according to scientific studies.

“Climate change has already influenced the likelihood of temperature extremes in the U.K.,” Dr. Nikos Christidis, with the Met Office, said in a statement Friday. “The chances of seeing 40°C days in the U.K. could be as much as 10 times more likely in the current climate than under a natural climate unaffected by human influence.”

WSJ : Elon Musk Opposes Twitter’s Request for Expedited Trial Over Stalled Deal

Elon Musk Opposes Twitter’s Request for Expedited Trial Over Stalled Deal
Billionaire’s lawyers filed court papers in first public response to Twitter’s lawsuit

Elon Musk filed a motion Friday opposing Twitter Inc.’s TWTR 4.00% request to expedite a trial over his intention to terminate his $44 billion takeover.

Lawyers for Mr. Musk filed papers with the Delaware Chancery Court, their first public response to the lawsuit filed earlier this week by the social-media company seeking to enforce the terms of their merger agreement. The court should reject Twitter’s “unjustifiable request to rush this,” they said in their filing.

Twitter has asked the court to expedite the proceedings, citing risks from the recent economic downturn and being held in limbo by a buyer. The company requested a trial by mid-September “to protect Twitter and its stockholders from the continuing market risk and operational harm resulting from Musk’s attempt to bully his way out of an airtight merger agreement.”

Mr. Musk moved to terminate the acquisition last week, saying the company hadn’t provided the necessary data and information he needed to assess the prevalence of fake or spam accounts and was “in material breach of multiple provisions” of the merger agreement.

Twitter has rejected that assertion and argued that Mr. Musk hasn’t adhered to the terms, including violating a nondisclosure agreement and then bragging about it on Twitter.

In Friday’s filing, Mr. Musk’s lawyers said: “The core dispute over false and spam accounts is fundamental to Twitter’s value. It is also extremely fact and expert intensive, requiring substantial time for discovery.”

Mr. Musk’s lawyers argued that “it is unnecessary to resolve these weighty considerations on a breakneck schedule” and asked for a trial date on or after Feb. 13 of next year, adding that the debt financing was valid until April 25, 2023.

Mr. Musk has fired criticism at Twitter through a steady stream of tweets over the past several months, and his lawyers have raised specific complaints in several letters that have been made public through securities filings. But Friday’s court document is the first time his side has laid out publicly a clear timeline around his concerns over data about fake and spam accounts, and included new claims about Twitter’s level of cooperation on the issue.

Mr. Musk’s side became concerned about Twitter’s user numbers after the company announced revisions in its first quarter earnings in April, when it said it had overstated its user base for nearly three years through the end of 2021 due to an error in how it accounted for people linked to multiple accounts. The revision reduced the number of monetizable daily active users by 0.9% for the fourth quarter of last year.

In a May 6 meeting with Twitter executives about how spam is calculated, Mr. Musk ’s team on Friday said he was “flabbergasted to learn just how meager Twitter’s process was,” and pointed to the absence of automated tools to help with the calculation.

Twitter has long estimated that fewer than 5% of its monetizable daily active users are spam or fake accounts, a figure Mr. Musk has disputed. In its suit against Mr. Musk, Twitter said the Telsa Inc. CEO’s attempt to abandon the transaction reflects souring market conditions that resulted in his personal wealth declining by more than $100 billion from its November 2021 peak. “Rather than bear the cost of the market downturn, as the merger agreement requires, Musk wants to shift it to Twitter’s stockholders,” the company said.

Twitter had said it had bent over backwards to accommodate Mr. Musk’s data request, including by giving him access to its so-called fire hose of near real-time tweets as well as historical tweets. His side on Friday countered that the interactions were akin to “a two-month treasure hunt of delays, technical bottlenecks, evasive answers, and, ultimately, refusals.”

Twitter has said its process for estimating fake and spam accounts on its platform involves multiple human reviews of thousands of accounts sampled at random over time and that it also relies on private user data it doesn’t disclose publicly—and hasn’t shared with Mr. Musk—such as IP addresses and phone numbers.

Mr. Musk’s side also took issue with other elements of the Twitter suit, including the company’s assertion that the billionaire had disparaged the business he was planning to buy. “With the sense of humor of a bot, Twitter claims that Musk is damaging the company with tweets like a Chuck Norris meme and a poop emoji. Twitter ignores that Musk is its second largest shareholder with a far greater economic stake than the entire Twitter board,” the filing states.

WSJ : Merck Deal for Seagen Unlikely by Earnings, Sources Say

Merck Deal for Seagen Unlikely by Earnings, Sources Say
Deal talks still on track but upcoming data, arbitration slowed timeline, people familiar with the matter say

Merck & Co.’s roughly $40 billion deal for Seagen Inc. is unlikely to be finalized ahead of the pharmaceutical giant’s earnings later this month, though the talks remain on track, according to people familiar with the matter.

The Wall Street Journal reported earlier this month that Merck aimed to agree on a purchase of the cancer biotech within a few weeks, a plan that has since been delayed, the people said.

The change is due partly to a need to wait for data expected soon from a study evaluating one of Seagen’s treatments, the people said. There is also a desire to possibly see the outcome of a royalties-payments case Seagen is pursuing that is also expected soon, the people said. Both could have an impact on Seagen’s valuation.

There is still no guarantee the companies will reach agreement on a takeover deal. Merck is set to report its fiscal second-quarter earnings July 28.

Acquiring Seagen would help Merck broaden its lineup of cancer drugs, currently led by the blockbuster immunotherapy Keytruda.

Seagen helped pioneer a class of drugs known as antibody drug conjugates. The therapies take advantage of the honing abilities of antibody drugs to deliver a potent toxin to a specific tumor target.

As soon as this month, a study evaluating Seagen’s Padcev as a first-line treatment for bladder cancer could produce data. The study is examining Padcev’s use alone and in combination with Keytruda, according to analysts.

Padcev is currently approved to treat bladder-cancer patients who had failed a previous therapy. Sales for treating first-line bladder cancer could amount to billions of dollars a year if study results are positive and regulators approve the use, analysts have estimated.

A combination with Keytruda for bladder cancer could also help Merck extend the commercial life of its product after current patents run out later this decade, according to the analysts.

Additionally, Seagen could receive significant royalties and milestone payments if it wins an arbitration case and other litigation against Japanese drugmaker Daiichi Sankyo Co. Ltd., a former partner that went on to develop its own line of antibody drug conjugates including a breast-cancer therapy called Enhertu.

Seagen has alleged that Enhertu and the rest of Daiichi’s antibody-drug-conjugate pipeline infringes on Seagen’s patented technology, while Daiichi has said Enhertu doesn’t rely on Seagen’s technology, according to analysts. Daiichi sells Enhertu with AstraZeneca PLC.

A ruling in the arbitration case is expected as early as this summer, according to people familiar with the matter.

>>> US Close Dow +2,15% S&P +1,92% Nasdaq +1,79% Russell +2,16%

Closing Stock Market Summary: Buyer conviction picks up ahead of weekend

Buying interest picked up today to build on yesterday's rally. The major indices closed decidedly higher with the Dow Jones Industrial Average leading, up 2.2%. Despite the strong finish, the DJIA still lost 0.2% for the week while the S&P 500 fell 0.9%.

The buyer conviction was fueled by the better-than-expected Retail Sales data, which showed a 1.0% increase on both the headline level and when excluding auto sales. Retail sales are not adjusted for inflation, so the increase in sales was largely a reflection of consumers tolerating higher prices. Recall that CPI increased 1.3% month-over-month in June.

The July University of Michigan Consumer Sentiment preliminary reading was 51.1 (Briefing.com consensus 49.4), compounding the positive bias. The reaction to this may be outsized since the final reading for June was the lowest reading ever on records dating back to 1978. In addition, the slight uptick in consumer sentiment was due to falling oil prices. Crude oil, which fell past its 200-day moving average yesterday (93.58) to a level not seen since late February, settled up more than $2.00 today, and up $7.36 or 8.1% off yesterday's low. 

Despite the factors fueling buying interest, the Atlanta Fed GDPNow estimate was downwardly revised today and shows an expected contraction of 1.5% from 1.2% in the prior forecast.

To be fair, the positive bias today was also aided by favorable earnings and/or guidance from several large stocks. Citigroup (C 49.98, +5.84, +13.2%), Wells Fargo (WFC 41.13, +2.39, +6.2%), and UnitedHealth (UNH 529.75, +27.32, +5.4%) all showed big gains today. Citigroup had the best Q2 results of any big bank thus far while Wells Fargo missed estimates but noted that net interest income is expected to be 20% higher than 2021. UnitedHealth beat earnings estimates and issued above-consensus guidance.

These names also gave a nice boost to their respective S&P 500 sectors, financials (+3.5%) and health care (+2.5%), which closed at the top of the leaderboard. All 11 sectors closed in the green with countercyclical sectors, utilities (+0.2%) and consumer staples (+0.4%), rounding out the bottom of the pack. Even with today's underperformance, these two sectors finished the week ahead of the remaining nine sectors.

The 2s10s spread became more inverted this week with the 2-yr note yield up one basis point on the day and week-to-date to 3.13%. The 10-yr note yield dropped notably this week, settling down three basis points on the day and 17 basis points week-to-date to 2.93%.

Before Monday's open, a few more financials are set to report earnings, including Bank of America (BAC 32.25, +2.1%, +7.0%), Charles Schwab (SCHW 62.18, +1.61, +2.7%), and Goldman Sachs (GS 293.87, +12.28, +4.4%).

Economic data on Monday will be limited to the July NAHB Housing Market Index (Briefing.com consensus 66; prior 67) at 10:00 a.m. ET and May Net Long-Term TIC Flows (prior $87.7 billion) at 4:00 p.m. ET.

Today's notable economic data includes:

  • Total retail sales increased 1.0% month-over-month (consensus 0.8%) following an upwardly revised 0.1% decrease (from -0.3%) in May. Excluding autos, retail sales increased 1.0% ( consensus 0.6%) following an upwardly revised 0.6% increase (from 0.5%) in May.
    • The key takeaway from the report is that it was strong enough to keep concerns about weakening consumer spending at bay for the time being. At the same time, it needs to be acknowledged that these figures are not adjusted for inflation, so they should not be viewed as an exact reflection of consumer strength.
  • Total industrial production decreased 0.2% month-over-month in June (consensus 0.2%) following a downwardly revised flat reading in May (from 0.2%). The capacity utilization rate decreased to 80.0% ( consensus 80.0%) from an upwardly revised 80.3% (from 79.0%) in May.
    • The key takeaway from the report is that total production was weighed down by the second consecutive month of falling manufacturing output. A continuation of this dynamic would be viewed as a negative signal about the strength of the manufacturing sector.
  • The preliminary reading of the University of Michigan Index of Consumer Sentiment for July rose to 51.1 ( consensus 49.4) from June's final reading of 50.0. One year ago, the July reading was at 81.2.
    • The key takeaway from the report is that the slight improvement in sentiment was owed to a dip in inflation expectations after the recent pullback in energy prices. While any improvement is a welcomed sight, this one could be reversed easily if energy prices rebound.
  • The Empire State Manufacturing survey rose to 11.1 (consensus -0.9) in July from -1.2 in June.
  • Business Inventories increased by 1.4% in May (consensus 1.2%) after increasing a revised 1.3% (from 1.2%) in April.
  • Import prices rose 0.2% in June after increasing a revised 0.5% (from 0.6%) in May. Excluding oil, import prices fell 0.5% after decreasing 0.3% in May. Export prices rose 0.7% in June after increasing a revised 2.9% (from 2.8%) in May. Excluding agriculture, export prices rose 0.9% after increasing a revised 3.0% (from 2.9%) in May.
  • Dow Jones Industrial Average: -13.9% YTD
  • S&P 400: -18.9% YTD
  • S&P 500: -19.0% YTD
  • Russell 2000: -22.3% YTD
  • Nasdaq Composite: -26.8% YTD

>>> Europe : Brokers Upgrades & Downgrades - 15th of July 2022 V2(+)

>>> Up
* Almirall Raised to Buy at JB Capital Markets; PT 15.20 euros (+)
* Novo Nordisk Raised to Overweight at Morgan Stanley
* Nyfosa Raised to Hold at SEB Equities; PT 90 kronor
* SEB Raised to Buy at Arctic Securities; PT 118 kronor
* Standard Chartered Raised to Buy at Investec; PT 610 pence
* Uniper Raised to Neutral at Goldman; PT 10 euros

>>> Down
* Admiral Cut to Underweight at JPMorgan; PT 1,750 pence
* Chemring Group Cut to Underweight at Barclays; PT 336 pence
* Cognor Holding SA Cut to Sell at Erste Group; PT 3.13 zloty
* Direct Line Cut to Neutral at JPMorgan; PT 240 pence
* EasyJet Cut to Underweight at JPMorgan; PT 310 pence
* Eurobank Cut to Neutral at Goldman; PT 92 euro cents
* HMS Networks Cut to Hold at Nordea
* SBB Cut to Hold at Nordea
* Senior Raised to Overweight at Barclays; PT 183 pence
* Wizz Air Cut to Reduce at HSBC; PT 1,350 pence

>>> Initation
* Abcam Maintained at Hold at Panmure Gordon
* Bawag Rated New Buy at Deutsche Bank; PT 73 euros
* Darktrace Rated New Buy at Stifel; PT 570 pence
* Dassault Aviation Reinstated Neutral at JPMorgan; PT 162 euros
* Exclusive Networks Rated New Buy at Stifel; PT 21.50 euros
* Siemens Energy Resumed Neutral at Citi; PT 16 euros
* Siemens Gamesa Resumed Neutral at Citi; PT 18.05 euros
* WithSecure Rated New Hold at Stifel; PT 2.60 euros

>>> Call
* Deutsche Telekom May Sell German Towers Only, Jefferies Says
* Direct Line Upgraded at Berenberg as Stock ‘Too Cheap to Ignore’
* Handelsbanken Miss Driven by Trading; NII Holds Up, Citi Says (+)
* Munters Sales Growth Not Translating Into Profits: Jefferies (+)
* Novo Nordisk Raised at MS on Blockbuster Obesity Opportunity
* Partners Group Update ‘Mixed,’ Citi Expects Negative Reaction (+)
* Rio Tinto Drops After Outlook Warning; RBC Sees 2Q Output Miss
* Voestalpine Earnings Beat, Though Analysts Note Backward-Looking

FT : Draghi drama spells more trouble ahead for Italy

Draghi drama spells more trouble ahead for Italy
Fresh political turbulence comes amid worsening economic outlook

Italian Prime Minister Mario Draghi remains in office, for now, after the president rejected his resignation offer yesterday. But the high-intensity political drama unfolding in Rome spells more trouble for Italy amid weakening economic performance, soaring inflation and a looming gas supply crisis.

In Skopje, European Commission president Ursula von der Leyen made an attempt at convincing the entrenched opposition in the North Macedonian parliament to embrace a French proposal that could unblock the Balkan country’s EU membership bid.

And in lighter (though not calorie-wise) news, the EU’s top court ruled that Danish dairy producers should not name their cheese feta.

Super Mario, buffering
Mario Draghi’s frustration with Italy’s fractious political parties, and their pre-election political manoeuvring, could soon bring an end to his term as prime minister amid gathering storms on the economic front, write Amy Kazmin in Rome and Sam Fleming in Brussels.

“The majority of national unity that had supported this government since its creation is no longer there,” Draghi said in a statement as he offered to resign. President Sergio Mattarella has rejected that offer and asked him to address parliament next week to assess how much support his government would have.

Markets were quick to react to this fresh bout of political turbulence: Italian stocks sold off yesterday, with a FTSE gauge of equities in the country sliding 3.4 per cent. The yield on Italian 10-year government bonds rose to 3.24 per cent, sending the gap with German 10-year yields higher as investors demand a rising premium for holding Italian debt.

Asked about this renewed political upset, EU economics commissioner Paolo Gentiloni (and a former Italian prime minister himself) stressed the importance of not adding political tremors at a time of high tension. “In these troubled waters — war, high inflation, energy risks, geopolitical tensions — stability is a value in itself. Now is the time for sticking together, for cohesion.” 

Forecasts from the EU commission yesterday showed the toll the war is taking on the Italian economy: growth is now forecast to slow dramatically between this year and next, decelerating from a respectable 2.9 per cent in 2022 to only 0.9 per cent in 2023. The commission blamed ebbing real household purchasing power in the face of soaring commodity prices, as well as sliding consumer sentiment, rising fund costs and continued supply chain bottlenecks.

“The risks to the growth outlook are tilted to the downside, in particular in view of potential supply disruptions of natural gas, given Italy’s still sizeable dependency on deliveries from Russia despite recent diversification efforts,” the commission said.

Tensions within Draghi’s national unity government had been rising ever since Russia’s invasion of Ukraine. Draghi has been staunch in his support for the government in Kyiv and a key architect of the tough sanctions against Moscow. But some members of his coalition — including the Five Star and the League — have traditionally had close ties with Moscow and Vladimir Putin.

Those tensions finally boiled over yesterday, when the Five Star party refused to support the government in a critical parliamentary vote on an aid package aimed at cushioning the impact of inflation on the population. Though the package still passed with a majority, Draghi has said he is unwilling to govern unless all large parties currently in the ruling coalition are willing to remain united behind him so he can be effective as a leader.

The suspense will rise as Draghi’s parliamentary appearance gets closer, with some parties eager to try to persuade him to stay on for another few months, and others calculating the likely benefits of early elections.

FT : Chinese regulators rush to tame investor panic over mortgage boycotts

Chinese regulators rush to tame investor panic over mortgage boycotts
Homebuyers stop paying loans on more than 200 unfinished property projects

Chinese regulators are trying to stamp out panic over rising home loan risks at banks as a wave of homeowners join a country-wide mortgage boycott of unfinished houses.

Hundreds of thousands of buyers have halted mortgage payments on more than 200 unfinished property projects in China this week, aggravating a property sector crisis that has dragged down economic growth.

The CSI 300 Banks index fell as much as 3.3 per cent on Thursday to its lowest level since March 2020 on signs that the boycott was gaining traction. Bank share performance was mixed on Friday, with some stocks extending losses despite statements intended to reassure investors.

The China Securities Regulatory Commission, the country’s top securities watchdog, asked banks to disclose the degree of their mortgage exposure in an attempt to address market concerns, according to two banking sources briefed on the matter.

Sixteen listed banks, including state-owned lenders, revealed Rmb2.8bn ($414mn) of loans vulnerable to the mortgage boycott. In co-ordinated filings, the banks emphasised that the loans in question accounted for a small portion of their total outstanding mortgage portfolios, representing less than 0.01 per cent of mortgage liabilities for most of the lenders. Some of the banks did not reveal their numbers.

The state-owned Agricultural Bank of China said it held Rmb660mn of overdue loans on unfinished homes, the largest among banks that disclosed their holdings. The smaller Industrial Bank said Rmb384mn of mortgages on unfinished homes had soured, while Ping An Bank revealed Rmb318mn of affected debts.

“Defaulting on the mortgage is a desperate move by these home buyers to get the banks’ attention and wrestle with the developers,” said Wang Qi, chief executive at fund manager MegaTrust Investment in Hong Kong.

“The biggest challenge for Chinese real estate is consumer confidence. The recent mortgage defaults have only added to the problem,” added Wang. “The government needs to repair the consumer sentiment and business confidence ASAP with more stimulus.”

The country’s banking and insurance watchdog said it would step up co-ordination with the central bank and housing regulator to help local governments complete pending real estate developments.

“From a positive view, such movement brings banks into negotiations to resume construction,” Jefferies analysts wrote on a note on Thursday. “However, investors are concerned about the spread of mortgage payment snubs simply due to lower property prices, and the impact on property sales, which will further deteriorate developers’ cash flow.”

Jefferies estimated that the delayed projects accounted for about 1 per cent of China’s overall banking mortgage balance.

Chinese authorities are expected to hasten to avoid systemic risks to the financial sector or wider economy.

“Household financial positions and social stability are regarded as top priorities for policymakers,” said Betty Wang, senior China economist at Australian lender ANZ.

Solutions could include guiding banks to support unfinished projects, granting longer grace periods for mortgage payments or exempting mortgage interest, according to a third banking source, who was briefed on a meeting between the People’s Bank of China, housing regulators and banks.