HONG KONG: China and Hong Kong stocks extended gains on Wednesday, supported by a rally in biotech and rare earth shares and hopes that a call between the US and China would cool trade tensions.
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At the close, both China’s blue-chip CSI 300 Index and the Shanghai Composite Index rose 0.4%.
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Hong Kong benchmark Hang Seng was up 0.6%. Tech giants listed in Hong Kong also gained 0.6%.
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Hang Seng Healthcare Index led the gains throughout the day, closing 3.2% higher, as investors bet on earnings growth in innovative drug makers.
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In A-shares, an index tracking shares of Hong Kong brokers advanced 2.7%, 5G communications stocks rose 2.5%, while CSI Rare Earth Industry Index gained 2.2%.
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The export of rare earths has been thrust into the spotlight in the US-China trade negotiations.
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Trump has previously signaled that China’s slow pace of easing the critical mineral export ban represents a violation of the Geneva agreement.
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Analysts say tariff uncertainties and US debt issues will continue to roil markets.
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“(Trade) expectations are unstable, economic disturbances are still large, and the macro environment continues to be under pressure,” analysts at Cinda Futures said in a note, expecting mainland A-shares to remain rangebound in the near term.
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In a post on Truth Social on Wednesday, Trump said that he likes President Xi but added that the Chinese president is very tough and “extremely hard” to make a deal with.
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The smaller Shenzhen index ended up 0.92% and the start-up board ChiNext Composite index was higher by 1.11%. Reuters
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