Hong Kong began a five-day mourning period on Saturday, after at least 128 people were killed in fires at a high-rise apartment complex. Officials held a three-minute silence as residents laid flowers near the towers. Authorities say around 200 people are still missing.
Published On 29 Nov 202529 Nov 2025
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A gauge of risk on Oracle Corp.’s debt reached a three-year high in November, and things are only going to get worse in 2026 unless the database giant is able to assuage investor anxiety about a massive artificial intelligence spending spree, according to Morgan Stanley.
A funding gap, swelling balance sheet and obsolescence risk are just some of the hazards Oracle is facing, according to Lindsay Tyler and David Hamburger, credit analysts at the brokerage. The cost of insuring Oracle Corp.’s debt against default over the next five years rose to 1.25 percentage point a year on Tuesday, according to ICE Data Services.
The price on the five-year credit default swaps is at risk of toppling a record set in 2008 as concerns over the company’s borrowing binge to finance its AI ambitions continue to spur heavy hedging by banks and investors, they warned in a note Wednesday.
The CDS could break through 1.5 percentage point in the near term and could approach 2 percentage points if communication around its financing strategy remains limited as the new year progresses, the analysts wrote. Oracle CDS hit a record 1.98 percentage point in 2008, ICE Data Services shows.
A representative for Oracle declined to comment.
Oracle is among firms taking part in an artificial intelligence spending race, which has quickly made the data center giant the credit market’s barometer for AI risk. The company borrowed $18 billion in the US high-grade market in September. Then in early November, a group of about 20 banks arranged a roughly $18 billion project finance loan to construct a data center campus in New Mexico, which Oracle will take over as tenant.
Banks are also providing a separate $38 billion loan package to help finance the construction of data centers in Texas and Wisconsin developed by Vantage Data Centers, Bloomberg reported last month. Lenders involved in these construction loans linked to Oracle are likely a key driver of the surge in trading volume on the Oracle’s CDS recently, a trend that may persist, according to Morgan Stanley.
“Over the past two months, it has become more apparent that reported construction loans in the works, for sites where Oracle is the future tenant, may be an even greater driver of hedging of late and going forward,” wrote the analysts.
There is a risk that some hedges by banks could unwind if and when banks distribute these loans to other parties, they wrote. Still, other parties may also hedge at some point even if down the road plus the construction debt funding needs don’t stop after the Vantage sites and the New Mexico site.
Last month, the analysts said they expect near-term credit deterioration and uncertainty to drive further hedging by bondholders, lenders and thematic players.
“The bondholder hedging dynamic and also the thematic hedging dynamic could both grow in importance down the road,” they added.
Oracle CDS have underperformed the broader investment-grade CDX index and Oracle corporate bonds have underperformed the Bloomberg high-grade index amid the jump in hedging demand and the weakening sentiment. Concerns have also started to weigh on Oracle’s stock, which the analysts said may incentivize management to outline a financing plan on the upcoming earnings call, including details on Stargate, data centers and capital spending.
The analysts had previously been recommending investors buy Oracle bonds and CDS in what is known as a basis trade, to profit from their expectation that credit derivatives would widen more than the bonds. Now they’re saying it’s a cleaner trade to just buy the CDS outright.
“Therefore, we are closing the ‘buy bond’ part of the basis trade, and keeping the ‘buy CDS protection’ leg of it,” they wrote. “We think a trade in CDS outright is cleaner right now and will result in a greater spread move.”
Larry Ellison, Oracle’s chairman of the board, is backing his son David Ellison’s bid to acquire Warner Bros Discovery, which is also considering offers from Netflix and Comcast.
Mutua writes for Bloomberg.
Bamboo scaffolding, a centuries-old technique that was traditionally ubiquitous in Hong Kong, is under scrutiny for its role in the city’s deadliest fire in more than a century.
At least 55 people have died, and hundreds are still missing since scaffolding at a housing estate in Tai Po district caught fire on Wednesday, according to the latest government figures.
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Bamboo is cheap, lightweight, and strong enough to withstand the city’s many typhoons and tropical storms. Hundreds of bamboo poles can often be seen lashed together on the side of a modern office tower.
But could one of Hong Kong’s iconic symbols also have served as the kindling for one of its most horrific tragedies in decades?
Buildings or housing estates – like the one in Tai Po district – encased in bamboo during significant renovation projects are not a rare sight in the city-state. Sometimes, the scaffolding can remain up for a year or more.
Bamboo scaffolding is built by speciality workers known as “spiders”. They lash together bamboo poles to build intricate grid-like scaffolding that is then typically covered in additional netting to catch construction materials.
While the use of bamboo has faded in other parts of Asia, it has been hard to replace it completely in Hong Kong, even with options such as metal scaffolding, said experts.
“It’s light, cheap and fast to build with,” Ehsan Noroozinejad, a senior researcher and construction expert at Western Sydney University, Australia, told Al Jazeera. “Crews carry poles by hand, cut them on site, and wrap awkward facades without cranes. That speed and flexibility keep projects moving and costs down.”
Because it is “light and easy to cut”, bamboo scaffolding also fits the narrow living environment of Hong Kong, said Xinyan Huang, deputy director of the Research Centre for Fire Safety Engineering at Hong Kong Polytechnic University.
But there are other reasons, too, why bamboo is hard to replace.
“It [Hong Kong] has a long history, so it is a tradition, and it is not easy to change tradition,” Huang told Al Jazeera by email. “Any change in the construction industry will meet much resistance from current players.”
There are 4,000 bamboo scaffolding workers in the city, Hong Kong Free Press reported, citing union figures, although the industry is on the decline thanks to increased competition from metal scaffolding and an ageing cohort of workers.
Prior to the fire, most concerns around bamboo scaffolding have focused on worker safety.
There were 22 fatal workplace accidents involving bamboo scaffolding in Hong Kong between 2018 and 2024, according to government figures. Six accidents occurred while new scaffolding was being built, while the rest took place during repairs.
Besides the fact that bamboo is by its very nature combustible, it is also structurally weaker and less stable than steel, according to Huang. He told Al Jazeera that it should be phased out for larger projects.
“I think the bamboo scaffolding can be used for small-scale applications, such as installing an air conditioning unit and replacing a window of a room. However, the large-scale usage such as covering the entire building facade should be stopped. Perhaps, a maximum area of bamboo scaffolding can be defined in future regulation,” he said.
The fire is the deadliest in Hong Kong in more than a century, since a blaze in 1918 at the Happy Valley Racecourse in British Hong Kong led to the deaths of more than 600 people.
Bamboo scaffolding played a big role in spreading the fire, according to experts like Anwar Orabi, a lecturer in fire safety engineering at the University of Queensland, although it was helped by other materials in the estate.
The fire broke out on the scaffolding of one of the estate’s towers on Wednesday, but the speed with which the fire spread took many observers by surprise. Orabi said the design of the scaffolding made it difficult to keep the blaze limited to just a few floors.
“In my point of view, the scaffolding presented a path for the fire to spread vertically which compromised compartmentation. The fire ‘climbed’ the scaffolding, and ignited the multiple fuel sources in people’s homes,” he told Al Jazeera by email.
“Fire can break windows by imposing a strong heat flux [flow of heat] which heats up the glass and breaks it. It is also possible that many people left their windows open resulting in ingress of the fire. This resulted in a multi-storey fire,” he said. Heat radiation and embers from one building helped spread the fire to the next, he said, ultimately engulfing seven towers.
Hong Kong officials also say substandard construction materials were another contributing factor. The South China Morning Post reported that the netting placed over the scaffolding did not adhere to the fire code, citing local officials.
Senior police superintendent Eileen Chung said highly flammable Styrofoam boards had also been placed in windows in the housing estate’s lifts, public broadcaster RTHK reported, helping the fire spread.
Two directors and one engineering consultant from the company behind the construction have been detained, Chung confirmed.
Hong Kong’s leader, John Lee Ka-chiu, has promised that all housing estates undergoing significant improvements will now be inspected.
“The government has immediately arranged for inspections of all housing estates across the city undergoing major repairs, to examine the safety of scaffolding and building materials,” he wrote on Facebook.
At least 44 people have died after Hong Kong’s worst fire in 63 years tore through several high-rise buildings on Wednesday afternoon, officials said.
Firefighters are still fighting the blaze in the Tai Po neighbourhood, and trying to reach people who are trapped inside.
By early Thursday morning, officials said they had brought the fire in four buildings under control, but firefighters were still working on three others more than 16 hours after the blaze started.
Here is what to know:
An apartment complex in Hong Kong’s Tai Po neighbourhood caught fire at about 2:51pm (06:51 GMT) local time on Wednesday.
The fire began on the bamboo scaffolding outside one of the buildings. This type of scaffolding, made from bamboo poles used by workers during repairs, burns very easily. Once the scaffolding caught fire, the flames quickly spread up the structure and into the building, and then to nearby towers.
The blocks were also wrapped in green construction netting all the way to the rooftops due to ongoing renovation work, which also caught fire, helping it spread faster.
According to local media, the fire intensified rapidly: By 3:34pm (07:34 GMT), it had reached a level four alarm, and by 6:22pm (10:22 GMT), it had reached a level five alarm – the highest alert level in Hong Kong.
The blaze is Hong Kong’s deadliest fire since at least August 1962, when a fire in the city’s Sham Shui Po district killed 44 people. A fire at the Garley Building on Nathan Road in Kowloon killed 41 people and injured 81 others in November 1996.
Since Monday, Hong Kong has been under a heightened fire alert as dry weather conditions made the risk of fire extremely high.
The fire started at Wang Fuk Court, a housing estate in Hong Kong’s Tai Po district.
The complex, built in 1983, consists of eight high-rise buildings with a total of 1,984 flats. According to local media reports, seven of the buildings were affected by the fire. Of those, four have since been brought under control.
Tai Po is a suburb of Hong Kong near the border with mainland China, and is home to approximately 300,000 residents. It is part of the government’s subsidised home-ownership scheme.
Property records show that Wang Fuk Court has been undergoing major renovation work, costing about $42.43m.
The fire spread very quickly because it started on the bamboo scaffolding around the building and spread to the green netting covering the structures.
Both the bamboo and the green netting burn easily, so once they caught fire, the flames shot up the outside of the tower and reached many floors.
Burning pieces then fell and set nearby buildings on fire within minutes. Wind and open areas from the renovation work likely made the flames grow even faster.
While the exact cause is still being investigated, officials say the flammable scaffolding, building materials, and the tall, closely packed towers all helped the fire get out of control.
Police also said they found mesh and other protective materials on the outside of the buildings that did not appear to be fireproof, as well as styrofoam materials on the windows.
“We have reason to believe that those in charge at the company were grossly negligent, which led to this accident and caused the fire to spread uncontrollably, resulting in major casualties,” Eileen Chung, senior superintendent at the Hong Kong Police Force, said.
Officers have arrested two directors and an engineering consultant, aged between 52 and 68, of a construction company.
Chung said police arrested them in the Tai Po, Ngau Tau Kok, and San Po Kong districts at about 2am on Thursday (18:00 GMT, Wednesday).
Authorities have confirmed the deaths of 44 people, including a firefighter. About 279 residents are still unaccounted for. As of 8am (00:00 GMT), at least 66 people had been admitted to hospital, the Hong Kong Hospital Authority told CNN. Of those, 17 were in critical condition, and 24 were listed as serious.
Four people died in hospital. About 900 people have sought shelter in community centres.
It is now 9:42am (01:42 GMT) in Hong Kong, and according to local reports, firefighters are still fighting the blaze.
Earlier, the South China Morning Post reported that Derek Armstrong Chan, the deputy director of fire services, said extreme heat had prevented firefighters from accessing some upper-floor apartments. He added that crews would “keep trying” to reach them.
He also said that the “debris and scaffolding of the affected building are falling down, posing additional danger to our frontline personnel”.
Overnight, he said, it was dark, and that made the rescue and firefighting operation “more difficult”.
“In the hours of darkness, it will pose additional danger and difficulties to our operation, and up to this moment, the temperature inside the fire scene is still very high. So, we have difficulties proceeding to upper floors of two of the buildings.”
The Hong Kong Fire Services Department mobilised more than 1,200 fire and ambulance personnel to the site, officials said. Some in the area have returned to work and school.
