Hong Kong stocks firm, but trade and protest worries cap gains

• The yuan was quoted at 7.1305 per U.S. dollar at 08:14 GMT, 0.24pc firmer than the previous close of 7.148.
• Hong Kong stocks closed higher on Tuesday, tracking gains in mainland China on stimulus hopes.

Hong Kong stocks closed higher on Tuesday, tracking gains in mainland China on stimulus hopes, though uncertainties around Sino-U.S. trade talks and worries over protests in the island city curbed gains.

The Hang Seng index rose 0.3pc, to 25,893.40, while the China Enterprises Index gained 0.5pc, to 10,201.34.

Prospects for progress in U.S.-China trade talks dimmed on Monday after Washington blacklisted Chinese companies over Beijing's treatment of predominantly Muslim ethnic minorities, and President Donald Trump said a quick trade deal was unlikely.

Trump and his top economic adviser, Larry Kudlow, spoke in generally upbeat terms about this week's discussions with China, the first such high-level talks in more than two months, but Trump insisted he would not be satisfied with a partial deal.

Hong Kong's embattled leader Carrie Lam said on Tuesday the government had no plans at present to use colonial-era emergency powers to introduce more new laws, after a long weekend of violent protests saw widespread defiance of a ban on face masks.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.57pc, while Japan's Nikkei index  closed up 1pc.

The yuan was quoted at 7.1305 per U.S. dollar at 08:14 GMT, 0.24pc firmer than the previous close of 7.148.

The top gainers among H-shares were CSPC Pharmaceutical Group Ltd, up 6.88pc, followed by China Resources Beer Holdings Co Ltd, gaining 3.27pc, and Geely Automobile Holdings Ltd, up by 2.88pc.

The three biggest H-shares percentage decliners were Hengan International Group Company Ltd, which was down 1.49pc, ENN Energy Holdings Ltd, which fell 1.28pc, and SINOPHARM GROUP CO LTD, down by 0.99pc.

At close, China's A-shares were trading at a premium of  29.79pc over Hong Kong-listed H-shares.