Chinese property developer Country Garden made payments on two dollar bonds within their grace periods on Tuesday, ending a month-long saga that had become the focal point of global investors’ concerns about China’s struggling property sector.The company’s Hong Kong-listed stock pulled back from a drop of almost 5 per cent to 3 per cent in late-morning trading, following local media reports that it had made the late coupon payments totalling $22.5mn on two $500mn international bonds.

A person close to the company and a bondholder told the Financial Times that Country Garden had made the payments, which it had initially missed in early August. Country Garden declined to comment.

The late payments mean the cash-strapped developer has narrowly avoided a technical default, but traders said this would not change the narrative of widespread and worsening financial strain in China’s vast and economically important real estate sector.