HONG KONG: China stocks gave up most of their gains and closed flat on Friday, weighed down by a drop in bank shares, while Hong Kong shares held on to gains after a Goldman upgrade.
At market close, the Shanghai Composite index was barely changed to hold at 3,510.18 after touching a 9-month high in the morning session. The blue-chip CSI300 index was also flat with 0.1% gain.
Still, the Shanghai Composite Index has added 1% for the week in a third straight week of gains, the longest winning streak since February.
The rare earth sector led the gains with a surge of over 5% to its highest since early 2023. However banking stocks slid 2.4% in the afternoon session after hitting to a record high on Thursday.
The real estate sector also edged down 0.3%, paring Thursday’s rally spurred by unverified chatters that Beijing is mulling more measures to support property market.
In Hong Kong, the benchmark Hang Seng Index closed 0.5% up at 24,485.49, also pulling back from a 4-month high hit during earlier trades. The Chinese H-share index listed in Hong Kong, the Hang Seng China Enterprises Index, rose 0.2%.
Biotech and tech shares led gains in Hong Kong, with the Hang Seng Tech Index adding 0.6%, while the Hang Seng Biotech Index jumped 1.3%.
Goldman Sachs upgraded the city’s stocks to market weight, citing stronger earnings growth driven by improvements in both capital markets and property activity supported by low local interest rates.
Elsewhere, US Secretary of State Marco Rubio met with Chinese Foreign Minister Wang Yi in Kuala Lumpur on Friday, their first in-person meeting at a time of simmering trade tensions between the two major powers.
“We still expect near-term volatility to rise and range-bound index moves in the offshore market. We prefer A-shares over offshore for now,” Morgan Stanley’s China strategist Laura Wang said in a note.
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