China, Hong Kong stocks rise on trade deal optimism

China and Hong Kong stocks climbed on Monday, with the latter hitting a more than three-month high, bolstered by increasing optimism about the prospects for a Sino-U.S. trade deal. The CSI300 index rose 0.8%, to 3,982.52 points at the end of the morning session, while the Shanghai Composite Index gained 0.8%, to 2,980.43 points.

The Hang Seng index added 1.3% to 27,448.24 points, while the Hong Kong China Enterprises Index gained 1.5% to 10,779.38 points, both hitting their highest in more than three months. The United States and China on Friday said they made progress in talks aimed at defusing a nearly 16-month-long trade war that has harmed the global economy, and U.S. officials said a deal could be signed this month.

The Chinese Commerce Ministry on Friday said the world's two largest economies had reached "consensus on principles" during a "serious and constructive" telephone call between their main trade negotiators. Private exporters reported the sale of 132,000 tonnes of U.S. soybeans to China on Friday, the latest in a string of purchases the top buyer of the oilseed has booked as the world's two largest economies negotiate to end a bilateral trade war that has lasted more than a year. 

Investors also seemed to be encouraged by Beijing's increasing efforts to open up its financial markets. China's justice ministry on Friday published draft rules to allow foreign companies to list on the country's stock exchanges, with the intention of implementing the changes on Jan. 1. The smooth progress in the Sino-U.S. trade talks could help boost expectations of yuan stabilization, while the reallocation of global assets amid U.S. interest rate cuts would bring more money to the A-share market which enjoys an advantage in terms of valuations, Bohai Securities said in a report.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.97% while Japan's Nikkei index was down 0.33%. The yuan was quoted at 7.0275 per U.S. dollar, 0.14% firmer than the previous close of 7.0372. So far this year, the Shanghai stock index is up 18.62%, while China's H-share index is up 4.9%. Shanghai stocks have risen 0.99% this month.

About 9.77 billion shares have traded so far on the Shanghai exchange, roughly 62.5% of the market's 30-day moving average of 15.64 billion shares a day. The volume traded was 15.99 billion as of the last full trading day. As of 04:04 GMT, China's A-shares were trading at a premium of 28.87% over the Hong Kong-listed H-shares.

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