Breaking | Hong Kong, China stocks rebound to finish higher on hopes Beijing will act to limit trade war damage

Hong Kong and mainland China markets bounced back from earlier losses to finish higher on Tuesday after the US unveiled a new round of tariffs on US$200 billion worth of imported Chinese goods..

Analysts said sentiment was buoyed by hopes that the Chinese government would take measures to stabilise the economy amid a protracted trade war with the US.

“The Hang Seng Index rebounded and is establishing a near-term support at about the 26,200 level,” said Stanley Chan, director of research at Emperor Securities. “Yesterday’s market drop had mostly priced in the new tariffs, while China may launch more stimulative measures to stabilise the economy.”

The benchmark Hang Seng Index rose 0.6 per cent, or 151.81 points, to 27,084.66 after dropping by as much as 1.1 per cent earlier in the day. It remains down by 19 per cent down from its January peak.

The Hang Seng China Enterprises Index was up 0.9 per cent, or 94.89 points, at 10,556.98.

The Shanghai Composite Index on the mainland gained 1.8 per cent, or 48.16 points, to 2,699.95 points. The gauge had dropped 1.1 per cent to close at its lowest level in more than three years on Monday.