China, Hong Kong markets climb on trade hopes, strong comeback by stocks that mysteriously plunged

Hong Kong and China stocks climbed on Friday, boosted by higher hopes for a resolution to the US-China trade war and a strong comeback by a clutch of companies that plunged suddenly on Thursday.

The Hang Seng Index climbed 1.25 per cent, or 335.18 points, to close the week at 27,090.81 with eight of the nine sub-indexes in positive territory. Friday’s close was at the highest level so far this year, and it is up nearly 5 per centper cent since January trading began.

The Shanghai Composite Index rose 1.42 per cent, or 36.36 points, to 2,596.00. The CSI 300 of blue-chips closed up 1.8 per cent, or 56.75 points, to 3,168.17. Both were up for their third straight week and saw their biggest weekly gains in two months. The Shanghai Composite – the worst performer among major markets in the world last year – is up 4 per cent for the year.

Markets this week have seen big swings between gains and losses, dominated by macro factors including China’s signals for stimulus measures, more progress with trade talks and a slowing economy hurt by the trade war.

A Wall Street Journal report suggesting Treasury Secretary Steven Mnuchin was a proponent of easing tariffs boosted market sentiments, even though the Treasury Department later denied the report.