Country Garden shares exhibit volatility as China stocks remain unchanged

Updates to reflect Country Garden price move, in paragraph 5

HONG KONG, Nov 9 (Reuters) – Shares of Chinese property giant Country Garden 2007.HK fell sharply early on Thursday，giving up some of the previous day’s big gains on the back of a report that Beijing had asked Ping An Insurance Group to take a controlling stake in the embattled homebuilder.

The broader Shanghai and Hong Kong stock markets .HSI, .SSEC were flat as investors weighed the developments in the property sector and other stimulus measures.

Property stocks rose late on Wednesday after Reuters reported China’s State Council had instructed the local government of Guangdong province to help arrange a rescue of Country Garden by Ping An 601318.SS.

Ping An subsequently said in a statement to Reuters it has “not been asked by (the) Government to takeover Country Garden”.

Country Garden shares 2007.HK listed in Hong Kong dropped nearly 4% at the market open, following a 12% surge the previous day. It bounced back to gain more than 3% but then fell into negative territory again in heavy morning trade. Prices of Country Garden dollar bonds were unchanged.

Stocks of other Chinese developers were lower, with the Hang Seng Mainland Properties Index .HSMPI down about 2%, led by a decline in China Evergrande Group 3333.HK and CIFI Holdings 0884.HK shares.

Ping An’s Hong Kong-listed shares 2318.HK fell more than 1% to a one-year low, before paring some losses.

Hong Kong’s Hang Seng Index .HSI and China’s blue chip CSI300 .CSI300 were largely flat.

(Reporting by Summer Zhen; Editing by Lincoln Feast and Muralikumar Anantharaman)

((summer.zhen@thomsonreuters.com; 852-3462-7739;))

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