HONG KONG: China and Hong Kong stocks rebounded on Friday, with the Shanghai Composite eking out its first weekly gain in a month, tracking broad gains in Asian markets after the US cancelled its planned attack on Iran.
China’s blue-chip CSI300 Index closed 1.2 percent higher, while Shanghai Composite Index was up 1.1 percent.
For the week, the Shanghai Composite finished up 0.09 percent, but CSI.300 was down 0.8 percent.
Hong Kong benchmark Hang Seng rose 1.9 percent, but dropped 1 percent for the week, its fifth consecutive weekly loss, largely driven by geopolitical tensions and worries about US rate hike.
Gold-linked stocks, brokers and defence sector led the gains, rising 5.7 percent, 3.5 percent and 2.6 percent, respectively.
US President Donald Trump on Thursday said the United States and Iran could sign a peace deal as soon as this weekend that would reopen the Strait of Hormuz to shipping, but Iran said it had not reached a final decision on an agreement.
A-share listed commercial space-linked stocks surged on Friday, boosted by momentum from SpaceX’s upcoming listing. AVIC Chengdu Aircraft jumped 11 percent. Chengdu Spaceon Electronics gained 10 percent.
Despite optimism surrounding AI-related trades, investors expect broad Chinese markets to remain volatile in the near term due to concerns about consumer demand and regulatory uncertainties such as policies over capital flow and tech.
“There continues to be some reluctance on the part of foreign investors to purchase Chinese assets amidst the evolution of the regulatory environment in China,” Kristina Hooper, chief market strategist at Man Group, said in the asset manager’s midyear outlook.