Hong Kong stocks ended lower on Tuesday, snapping a six-week rally partly fuelled by optimism that China and the United States will hammer out a deal to resolve their trade dispute. The Hang Seng index ended 0.4 percent lower at 28,228.13, while the China Enterprises Index closed 0.3 percent weaker at 11,116.92 points. Reports of progress in trade talks between the United States and China have prompted investors to be mildly optimistic that the two countries can reach a compromise by March 1 that will de-escalate their dispute or at least avoid a sharp hike in tariffs, although very few details from the talks have emerged.
A new round of talks between the United States and China to resolve their trade war will take place in Washington on Tuesday, with follow-up sessions at a higher level later in the week, the White House said on Monday. The sub-index of the Hang Seng tracking energy shares ended up 0.2 percent, while the IT sector closed 1.49 percent lower, the financial sector ended 0.43 percent lower and the property sector ended 0.46 percent firmer.
The top gainer on the Hang Seng was China Life Insurance Co Ltd, which ended 3.02 percent higher, while the biggest loser was CSPC Pharmaceutical Group Ltd, which closed 7.97 percent weaker. Around the region, MSCI's Asia ex-Japan stock index was weaker by 0.17 percent, while Japan's Nikkei index closed up 0.1 percent. The yuan was quoted at 6.7645 per U.S. dollar, as of 0838 GMT, 0.04 percent firmer than the previous close of 6.7675.
The top gainers among H-shares were People's Insurance Company Group of China Ltd, which closed 3.08 percent firmer, followed by GF Securities Co Ltd, which ended 3.05 percent higher and China Life Insurance Co Ltd, which closed 3.02 percent higher. The three biggest H-shares percentage decliners were CSPC Pharmaceutical Group Ltd, which ended down 7.97 percent, Air China Ltd, which closed 3 percent down and China Vanke Co Ltd, which ended 3 percent weaker.
(With inputs from agencies.)