China, HK stocks rally on trade optimism
SHANGHAI- Hong Kong stocks recovered from weeks of underperformance following elections. Rekindled hopes over the possibility of US and China signing the deal soon heavily contributed to the said hike.
The Hang Seng index acquired 1.8% gains to 27,062.53 points while Hong Kong China Enterprises Index rose with 1.5% to 10,661.04.
US President Donald Trump and Chinese President Xi Jinping disclosed their willingness to sign the primary agreement aiming to defuse the 16-month trade war that has dragged and slowed economic progress.
An initial agreement is still possible by the end of the year, US national security adviser Robert O’Brien said on Saturday. However, he emphasized that Washington will never disregard the recent happenings in Hong Kong.
Pro-democracy candidates in Hong Kong sealed seats after residents voted in record numbers resulting to a landslide election last Sunday, following six months of political unrest in the city.
The elections contributed in lifting market anxiety, according to First Shanghai Securities’ analyst, Linus Yip.
“Liquidity conditions for the market would also improve as funds frozen for the subscription of Alibaba’s share sale will flow back, as the e-commerce giant is due to start trading on Tuesday in Hong Kong”, he added.
Mainland’s stocks also increased though earnings were restrained by losses for tech firms following US Federal Communications Commission act of prohibiting Huawei Technologies from government subsidy scheme.
The CSI300 index soared with 0.3% to 3,861.29 closing its morning session, as Shanghai Composite Index acquired 0.4% to 2,895.49 points.
Across the region, MSCI’s Asia ex-Japan stock index recorded a well-ended session with 0.78% earnings while Japan’s Nikkei index inched higher with 0.74%.
The yuan hit an equivalent of 7.0367 per US dollar, 0.05% firmer compared to its last session of 7.0405.
This year, Shanghai stock index reached up to 15.69% while China’s H-share index edged higher with 3.8% gains. However, Shanghai index recorded a 1.49% decline this month.