Finance Morning | August 20, 2026 — Evergrande's Xu Jiayin Sentenced to Life Imprisonment

📊 Today's Asian Markets

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Evergrande Founder Xu Jiayin Sentenced to Life; Group Fined Over 15.8 Billion Yuan

Source: Sina Finance

On the morning of August 20, the Shenzhen Intermediate People's Court in Guangdong Province delivered its first-instance verdicts in the cases of Evergrande Group, Evergrande Real Estate, and Xu Jiayin. The court sentenced Evergrande Group to a fine of RMB 8.82 billion, Evergrande Real Estate to a fine of RMB 7 billion, and Xu Jiayin to life imprisonment with deprivation of political rights for life and confiscation of all personal property. The court ordered continued recovery of illegal gains, with any shortfall to be repaid.

The court found that between 2016 and 2021, Evergrande Group, Evergrande Real Estate, and Xu Jiayin violated national laws by using sustained, large-scale financial fraud to inflate assets and conceal liabilities, committing crimes including illegal absorption of public deposits, fundraising fraud, fraudulent issuance of securities, and failure to disclose important information. The group and Xu Jiayin also used bribery to gain control of financial institutions, committing unit bribery, illegal lending, and illegal use of funds. Xu Jiayin was found guilty of eight charges in total.

On the same day, the Shenzhen Intermediate Court and Nanshan District Court also publicly sentenced 56 individuals involved in the Evergrande cases, including Zhen Litao, Ke Peng, Xu Tenghe, Xu Zhijian, Du Liang, and Liang Dong, to prison terms ranging from 18 years to one year and ten months, with fines or confiscation of property. Xu Jiayin's two sons, Xu Tenghe and Xu Zhijian, were among those sentenced. Public records show Xu Jiayin was taken under compulsory measures on September 28, 2023; China Evergrande was ordered into liquidation by the Hong Kong High Court on January 29, 2024, and was formally delisted in August 2025.

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Alibaba Q1 FY2027 Revenue Hits 268.95 Billion Yuan; Cloud Growth at 22-Quarter High

Source: MyDrivers

On August 20, Alibaba Group released its fiscal first-quarter 2027 earnings. Revenue reached 268.95 billion yuan, up 9% year over year, with adjusted net profit of 20.72 billion yuan. Alibaba Cloud's external commercialization revenue accelerated 45%, the fastest growth in 22 quarters, while AI-related product revenue hit 12.376 billion yuan in the quarter, marking the 12th consecutive quarter of triple-digit growth.

At the chip level, Alibaba's self-developed computing power achieved scaled commercialization. Its T-Head division has built a full-stack self-developed system covering GPU, CPU, and network chips, including the latest-generation AI processor Zhenwu M890, commercially applied to more than 650 external customers across 20-plus industries including autonomous driving, internet, and finance through Alibaba Cloud. Alibaba Cloud has compressed the delivery cycle for large-scale AI data centers to 100 days. In models, Alibaba open-sourced the 2.4-trillion-parameter Qwen3.8-Max and Qwen3.8-27B models; Qwen series downloads worldwide have surpassed 3 billion, with more than 300,000 derivative models.

In e-commerce, as of June 30, 2026, 88VIP membership reached approximately 64 million, maintaining double-digit year-over-year growth. Instant retail revenue surged 45% year over year, with Taobao Flash Purchase entering a phase of loss reduction alongside growth. The Qianwen app has brought 250 million users to AI-assisted shopping and is adding diversified value-added services.

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Shanghai Unveils "Eight Housing Measures"; Subsidies Up to 80,000 Yuan Per Home

Source: China News Service

Shanghai issued the "Notice on Optimizing the City's Real Estate Policy Measures" on August 20, effective August 21, 2026. The notice covers eight policy measures across five areas: optimizing housing provident fund withdrawals, optimizing personal housing credit, implementing "trade-in" purchase subsidies, promoting housing-voucher resettlement, and advancing the purchase of second-hand homes. It is known as the "Eight Housing Measures."

On provident fund withdrawals, building on the August 2025 "Six Measures" that allowed buyers of new presale commercial housing to use provident funds for down payments, the support scope now extends to purchases of completed homes, with property purchase taxes and parking space purchases also included. On credit policy, the minimum down payment for first homes is unified at no less than 15%; for second homes, regional differentiation remains — no less than 25% inside the Outer Ring and no less than 15% outside (including all of Baoshan and Jiading districts).

Shanghai also introduced a phased purchase subsidy under which eligible single homes can receive subsidies of up to RMB 80,000. Yan Yuejin, deputy director of the Shanghai E-House Real Estate Research Institute, said broadening the scope and uses of provident-fund down payments helps more buyers lower upfront costs and strengthens purchasing power. The phased subsidy supports the "trade-in" direction while encouraging the release of older small units in core urban areas, guiding residents to improve housing quality outside the Outer Ring for more balanced population distribution.

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Hong Kong Stocks: Hang Seng Up 1.14% at Midday, Innovative Drug Stocks Surge

Source: Sina Finance

Hong Kong's three major indices rose together on August 20. At the midday close, the Hang Seng Index gained 1.14% to 25,786.32 points, the Hang Seng Tech Index rose 1.54%, and the HSCEI advanced 1.42%. Internet stocks were mostly higher — Xiaomi and Baidu gained over 3%, JD.com, Alibaba, and NetEase rose over 2%, while Kuaishou fell more than 9%. Auto stocks strengthened, with Li Auto up over 5%.

Innovative drug stocks rallied broadly, led by Everest Medicines, which surged 68%. The catalyst: mRNA vaccine giant Moderna announced preliminary positive results from the Phase III clinical trial of a personalized mRNA cancer vaccine developed with Merck, sending Moderna shares up 177% overnight and lifting Hong Kong biotech stocks. Gold stocks also surged, with Zijin Gold International jumping 15%.

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Japan Posts 634.5 Billion Yen Trade Deficit in July, Third Straight Month of Deficits

Source: Epoch Times (compiled from Kyodo News)

Japan's Ministry of Finance reported on August 20 that July exports rose 23.2% year over year to 11.51 trillion yen, driven by semiconductor-related products and autos, while imports climbed 27.8% to 12.15 trillion yen amid sharply higher energy costs. The trade deficit widened to 634.5 billion yen — the third consecutive monthly deficit. On a comparable basis, both export and import values hit single-month records since comparable data began in January 1979.

By category, exports of semiconductor electronic components surged 49.1% year over year, semiconductor manufacturing equipment rose 40.9%, and autos grew 19.5%. By market, exports to China increased 25.8% to 2.01 trillion yen, growing for a fifth straight month to a single-month record; exports to the U.S. rose 22.0% to 2.09 trillion yen, also a single-month record. On imports, crude oil import value jumped 87.8%, semiconductor electronic components rose 79.7%, and nonferrous metals increased 67.7%. Analysts noted July export volumes grew only 5.2% year over year, suggesting the large nominal gains were driven mainly by a weaker yen, higher global selling prices, and demand for high-priced AI-related semiconductors.

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Samsung Plans Shareholder Return Program Exceeding 100 Trillion Won, a Korean Record

Source: Jiwei

Samsung Electronics plans to announce a new shareholder return policy later this month exceeding 100 trillion won (about USD 72.03 billion), aiming to share record profits with shareholders amid an AI-driven chip super cycle. Samsung will convene its board at the end of August to approve a shareholder return plan that includes a special dividend, dedicating 50% of its free cash flow to the program.

Meanwhile, domestic rival SK Hynix announced Wednesday a 40 trillion won share buyback and cancellation plan — the largest shareholder return program ever announced by a Korean listed company. SK Hynix also said it would devote over 50% of free cash flow to shareholder returns between 2025 and 2027. The news lifted Japanese and Korean markets, with the KOSPI closing up 5.89%, SK Hynix surging nearly 13% intraday, and Samsung Electronics gaining over 9%.

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Unitree Drops Over 17% on Second Trading Day, Market Cap Falls Below 300 Billion Yuan

Source: Tencent News

On August 20, "China's first humanoid robot stock" Unitree opened down 6.51% at 790 yuan. The stock weakened through the session, falling more than 17% intraday to a low of 700 yuan, with market cap dropping below 300 billion yuan. At press time, the stock was at 720.12 yuan, down 14.78%, for a market cap of 291.3 billion yuan. After a high open and weak close on its debut day with turnover of 85.28%, the negative feedback continued into the second session, triggering more stop-loss selling. The divergence between valuation and fundamentals is seen as the core of the pullback: based on the intraday high on its debut, the trailing P/E exceeded 800 times, and even at the closing price it stood near 585 times, versus an industry average of 38.56 times.

On its second trading day, founder Wang Xingxing delivered his first public speech since listing at the 2026 World Robot Conference. He said the core reason humanoid robots haven't been widely adopted is that "their overall efficiency and capabilities are still insufficient" — while robots can do some work, "their efficiency is still lower than humans." He estimated that the "ChatGPT moment" for embodied intelligence would ideally take 2–3 years, or as long as 5–10 years, defined as robots successfully completing about 80% of tasks in 80% of unfamiliar scenarios via voice or text commands.

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U.S. Federal Debt Tops $40 Trillion for First Time, About $116,000 Per American

Source: China News Service (compiled from Xinhua)

Data released by the U.S. Treasury on August 19 showed the U.S. federal government's total debt surpassed $40 trillion for the first time. That is nearly $10 trillion more than last year's U.S. GDP, meaning each American bears roughly $116,000 in debt. It marks another major milestone after debt crossed $33 trillion in 2023.

Analysts note that runaway U.S. debt growth exposes deep structural fiscal problems and transmits risk globally through dollar hegemony. Against this backdrop, the Treasury also announced on August 19 an expansion of its buybacks of longer-dated Treasuries to provide greater liquidity support, pushing bond yields sharply lower and underpinning a rebound in global risk appetite.

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Treasury Expands Long-Dated Buybacks; Fed Minutes Show Hawkish Lean

Source: Xinhua Finance

The U.S. Treasury announced August 19 that it will expand buybacks of longer-dated Treasuries to provide greater liquidity support. Under the statement, liquidity-support buybacks of long-dated bonds will be "at least doubled" from $2 billion to $4 billion, covering maturities from 10 to 30 years. Treasury yields fell across the curve that day, with the 10-year yield down 5.9 basis points to 4.647% and the 30-year down 9.1 basis points to 5.194%.

Minutes of the Fed's July meeting released the same day showed several officials favored a rate hike, and many believed further tightening could be necessary if inflation does not retreat. Markets thus received two opposing signals — a Fed leaning toward higher rates on one hand, and a Treasury trying to cap long-end yields on the other. Traders ultimately leaned toward the Treasury signal: CME FedWatch showed the implied probability of a September rate hike at about 36% as of Wednesday morning, down from over 70% at end-July. With Treasury yields retreating, the three major U.S. indices rose on August 19, with the Dow, S&P 500, and Nasdaq up 0.42%, 0.42%, and 0.40% respectively.

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Precious Metals Rally: Spot Gold Jumps Over 4% Past $4,500

Source: FX168

With long-end Treasury yields falling and the dollar at a three-month low, precious metals rallied across the board. At the close, spot gold settled at $4,522.68 per ounce, up $188.78, or 4.36% on the day; spot silver gained 5.81% to $66.98 per ounce; spot palladium rose 3.74% to $1,337.15 per ounce; and spot platinum was the strongest, soaring 6.07% to $1,817.45 per ounce after hitting an intraday high of $1,820.50.

The direct trigger was the U.S. Treasury's major expansion of long-dated bond buybacks, which sent Treasury yields tumbling and the dollar lower, igniting the precious metals rally. Meanwhile, U.S. federal debt surpassing $40 trillion keeps fueling the long-term logic of central banks adding gold. Citi forecasts gold could reach $5,000 per ounce over the next 6–12 months.