Hong Kong stocks end firmer on signs of U.S.-China trade deal progress

Hong Kong stocks closed higher on Thursday as investors cheered signs of progress towards a trade deal between the world's two largest economies.

The Hang Seng index rose 0.4%, to 26,041.93, while the China Enterprises Index gained 0.4%, to 10,212.27. China is in close communication with the United States and is preparing to make progress at trade talks in October, the commerce ministry in Beijing said on Thursday.

On Wednesday, U.S. President Donald Trump said a deal to end a trade war with China could happen sooner than people think and that the Chinese were making big agricultural purchases from the United States. However, gains were capped by doubts on whether the latest round of talks could yield a deal to the nearly 15-month long U.S.-China trade tussle and lingering worries over the political crisis on the island city.

Hong Kong leader Carrie Lam will hold her first talks with the public on Thursday in a bid to resolve a political crisis that has fuelled nearly four months of sometimes violent protests and plunged the Chinese-run city into chaos. Around the region, MSCI's Asia ex-Japan stock index edged 0.1% higher, while Japan's Nikkei index closed up 0.13%.

The yuan was quoted at 7.1286 per U.S. dollar at 08:22 GMT, 0.05% firmer than the previous close of 7.132. The top gainers among H-shares were China Merchants Bank Co Ltd up 3.77%, followed by Anhui Conch Cement Co Ltd, gaining 3.61% and China Resources Land Ltd, up by 2.34%.

The three biggest H-shares percentage decliners were PetroChina Co Ltd, which was down 1.98%, People's Insurance Company Group of China Ltd, which fell 1.56% and SINOPHARM GROUP CO LTD, down by 1.55%. At close, China's A-shares were trading at a premium of 29.93% over Hong Kong-listed H-shares.

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