SHANGHAI: China stocks climbed on Wednesday, touching their highest levels in nearly three weeks, lifted by optimism over progress in US-China trade talks, although investors awaited further details on the framework agreed upon by the two countries.
China’s blue-chip CSI300 Index rose as much as 1.2% to its highest since May 23. Hong Kong’s benchmark Hang Seng index climbed up to 1%, touching its strongest level since March 20.
US and Chinese officials said on Tuesday they had agreed on a framework to put their trade truce back on track and remove China’s export restrictions on rare earths while offering little sign of a durable resolution to longstanding trade differences.
“This is positive news to the market. At least now there’s a bottom line that neither side is willing to cross,” said Mark Dong, co-founder of Minority Asset Management.
“Going forward, both sides will move toward reducing the trade imbalance.”
The two-day meeting in London followed a leader-to-leader phone call between US President Donald Trump and China’s Xi Jinping last week after tensions between the countries flared, with each accusing the other of violating the Geneva deal.
Zeng Wenkai, the chief investment officer at Shengqi Asset Management, said markets had likely expected the outcome.
“People have realised that kneeling gets you nowhere — in fact, it only invites more bullying,” Zeng said, adding that countries are now adopting a tougher stance in negotiations with the US
The CSI Rare Earth Index gained more than 3%, while China’s semiconductor index fell 0.1%. “The details matter, especially around the degree of rare earths bound for the US, and the subsequent freedom for US-produced chips to head East,” said Chris Weston, head of research at Pepperstone.
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