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China, HK stocks firm as trade optimism lifts sentiment; tech rallies


China, HK stocks firm as trade optimism lifts sentiment; tech rallies
Image Credit: pixbay.com

China and Hong Kong stocks rallied on Monday, underpinned by gains in tech heavyweights after Beijing pledged more support for the sector, amid hopes that Sino-U.S. negotiators were making headway in their trade talks.

The CSI300 index was up 0.7% at 3,924.66 points, at the end of the morning session, while the Shanghai Composite Index gained 0.7% to 2,976.22 points. The Hang Seng index added 1.2% to 26,983.82 points, while the Hong Kong China Enterprises Index gained 1% to 10,569.76 points.

U.S. and Chinese officials are "close to finalizing" some parts of a trade agreement after high-level telephone discussions on Friday, the U.S. Trade Representative's office and China's Commerce Ministry said, with talks to continue. Washington and Beijing are working to agree on the text for a "Phase 1" trade agreement announced by U.S. President Donald Trump on Oct. 11. Trump has said he hopes to sign the deal with China's President Xi Jinping next month at a summit in Chile.

Beijing is attaching more importance to the country's tech sector and vowed to seek tech self-sufficiency as many giants, including Huawei, were blacklisted amid a bruising Sino-U.S. trade war. China's largely rubber-stamp parliament has passed a new law on cryptography as the country gears up to launch its own digital currency, state media reported late on Saturday.

Tech firms led the gains with blockchain-related stocks surging after the new law was passed. On the mainland, the CSI IT index jumped 3.5%, while the Hang Seng IT index climbed 2.4% in Hong Kong.

China is studying the application of blockchain and artificial intelligence in cross-border financing with a focus on risk management, and will further liberalize its capital markets, a senior foreign exchange regulator said on Sunday. The central government's emphasis on blockchain technology again confirmed the starting point of China's new tech cycle, China Merchants Securities noted in a report.

Proactively embracing new technology is a prerequisite to seizing the initiative in future global tech industries, while China's support would be unprecedented given the urgent need for independent innovation and potential evolution in the world's financial landscape, China Merchants Securities added. Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.50%, while Japan's Nikkei index was up 0.28%.

The yuan was quoted at 7.059 per U.S. dollar, 0.08% firmer than the previous close of 7.0647. So far this year, the Shanghai stock index is up 18.49%, while China's H-share index is up 3.4%. Shanghai stocks rose 1.71% this month.

As of 0417 GMT, China's A-shares were trading at a premium of 29.29% over the Hong Kong-listed H-shares.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


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