SHANGHAI: China and Hong Kong stocks extended their rally on Friday, bolstered by gains in consumer names, as Beijing seeks to further boost consumption and shore up falling growth amid the trade war.
** The CSI300 index rose 1% to 3,729.52 at the end of the morning session, while the Shanghai Composite Index gained 0.7% to 2,834.85.
** The Hang Seng index added 0.8% to 25,700.43, while the Hong Kong China Enterprises Index gained 0.7% to 9,974.41.
** China's state planner said on Friday it will roll out a plan to boost disposable income this year and in 2020 to spur consumption as the economy slows.
** On the mainland, the CSI300 consumer staples index climbed 1.8% by the midday, while the Hang Seng consumer goods index spiked 2.9% in Hong Kong.
** The strong gains also followed a raft of solid earnings reports by leading firms, including Tsingtao Brewery and Foshan Haitian Flavouring.
** Financials also lent some support, as the country's largest insurer Ping An Insurance (Group) Co of China added more than 2% following stellar profits in the first half.
** However, analysts expressed caution given various uncertainties at this moment.
** The A-share market could continue to be rangebound until any signs of strong positive signals, amid global recession fears and lingering Sino-U.S. trade tensions, Shanxi Securities said in report.
** U.S. President Donald Trump said on Thursday that U.S. and Chinese negotiators were holding "productive" trade talks and expected them to meet in September despite U.S. tariffs on over $125 billion worth of Chinese imports taking effect Sept 1.
** Nonetheless, China on Thursday vowed to counter the latest U.S. tariffs on $300 billion of Chinese goods but called on the United States to meet it halfway on a potential trade deal.
** Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.36% while Japan's Nikkei index was up 0.08%.
** The yuan was quoted at 7.039 per U.S. dollar, 0.08% weaker than the previous close of 7.0333.
** The largest percentage gainers on the main Shanghai Composite index were DuZhe Publishing & Media Co Ltd , up 10.06%, followed by ZheJiang JiHua Group Co Ltd , gaining 10.05% and WPG (Shanghai) Smart Water Public Co Ltd, up by 10.02%.
** The largest percentage losers on the Shanghai index were Changchun Sinoenergy Corp, down 5.11%, followed by Aurora Optoelectronics Co Ltd, losing 4.95% and Beijing Xinwei Technology Group Co Ltd, down by 4.94%.
** The top gainers among H-shares were China Resources Beer Holdings Co Ltd, up 7.15%, followed by CSPC Pharmaceutical Group Ltd, gaining 4.85% and Shenzhou International Group Holdings Ltd, up by 3.8%.
** The three biggest H-shares percentage decliners were Longfor Group Holdings Ltd, which has fallen 2.70%, China Railway Group Ltd, which has lost 1.4% and CRRC Corp Ltd, down by 1.2%.
** As of 04:15 GMT, China's A-shares were trading at a premium of 31.24% over the Hong Kong-listed H-shares.