Hong Kong, China stock markets soar after reports of Trump signing off trade deal
- Hang Seng Index caps its best week in nearly six months
- Macau stocks gain on reports of upcoming supportive policies from Beijing
Hong Kong and China stocks soared on Friday, propelled by reports that the US and China have reached an agreement on a “phase one” trade deal.
The Shanghai Composite Index posted its best daily performance in nearly four months. The benchmark jumped 1.8 per cent to close at 2,967.68, recording the biggest daily gain since August 19. The Shenzhen Component Index rose 1.7 per cent to 10,004.62.
In Hong Kong, the Hang Seng Index closed 2.6 per cent higher at 27,687.76, making it the third straight day of gains, with 48 of its constituents rising and only one declining. That represents its best one-day gain since September 4.
US President Donald Trump has approved an initial deal to resolve the US-China trade war, multiple US media outlets including Bloomberg News reported on Thursday. As a result, additional US tariffs on around US$160 billion of Chinese goods scheduled to kick in on Sunday are likely to be delayed.
Meanwhile, exit polls in the UK general elections showed Boris Johnson winning comfortably, suggesting a higher possibility of his Brexit deal going through and reduced uncertainty in the market.
“The market is getting two Christmas presents early,” Tai Hui, Asia chief market strategist at JPMorgan Asset Management, said in a note on Friday.
But he also said investors should not get carried away, as many uncertainties still remain. “The future stages of [US-China] negotiation are going to be much more challenging, when it starts to involve China’s industrial policy and technological development,” he said.