Hong Kong's Hang Seng ends lower as financials drag

Hong Kong's main Hang Seng index finished lower on Friday, weighed down by financial shares, but it closed nearly 3pc up for the week on rising investor hopes for more US stimulus and the prospect of Democratic victories in US elections in November.

At the close of trade, the Hang Seng index was down 74.22 points or 0.31pc at 24,119.13, but gained 2.81pc for the week.

The Hang Seng China Enterprises index ticked down 0.07pc to 9,617.85, bringing its gains for the week to 2.35pc - its biggest weekly rise since early July.

The sub-index of the Hang Seng tracking energy shares rose 0.4pc, while the IT sector rose 0.44pc, the financial sector ended 0.26pc lower and the property sector dipped 0.61pc.

Global investor sentiment, which has been whipsawed by changing expectations of US stimulus moves, recovered after US President Donald Trump on Thursday said talks with Congress had restarted on targeted fiscal relief.

That helped MSCI's Asia ex-Japan stock index to strengthen 0.76pc on Friday. Japan's Nikkei index closed down 0.12pc.

Adding to the sense of optimism in China, an industry survey showed the recovery in the country's service sector activity extended into a fifth straight month in September, with hiring increasing for a second month in a row.

A recovery in Chinese domestic travel over an eight-day national holiday period also helped boost sentiment onshore, pushing the Shanghai Composite index up 1.68pc and the blue-chip CSI300 index up 2.04pc.

The yuan was quoted at 6.713 per US dollar at 08:17 GMT, 1.26pc stronger than the previous close of 6.799, and on track for its biggest one-day percentage gain since July 2005.