June 20, 2019 / 4:46 AM / 5 months ago

China, HK stocks climb on hopes of trade truce, policy easing

* SSEC 2.6%, CSI300 3.3%, HSI 1.0%

* HK->Shanghai Connect daily quota used 5.9%, Shanghai->HK daily quota used 2%

* FTSE China A50 +3.5%

SHANGHAI, June 20 (Reuters) - China and Hong Kong stocks extended their rally on Thursday as signs that Beijing and Washington are returning to the negotiating table after a long lull lifted risk appetite.

** Expectations of a worldwide wave of central banks’ stimulus also helped bolster sentiment after the U.S. Federal Reserve signalled possible interest rate cuts later this year.

** The CSI300 index was up 3.3% at 3,838.06 points at the end of the morning session, while the Shanghai Composite Index gained 2.6% to 2,992.99.

** The Hang Seng index added 1% to 28,486.39 points, while the Hong Kong China Enterprises Index rose 1.1% to 10,881.89.

** Aiming to jumpstart dormant talks, the top U.S. trade negotiator said he will confer with his Chinese counterpart before next week’s meeting between U.S. President Donald Trump and Chinese President Xi Jinping in Japan as the two countries take another shot at resolving their damaging trade dispute.

** Upcoming trade talks between China and the United States are unlikely to immediately resolve major disagreements between the two sides, but could start a new phase in negotiations, Chinese state media said on Thursday.

** The U.S. Federal Reserve on Wednesday signalled interest rate cuts beginning as early as July, saying it is ready to battle growing global and domestic economic risks as it took stock of rising trade tensions and growing concerns about weak inflation.

** Foreign inflows also helped boost stocks on the mainland, with investors via the Stock Connect linking mainland and Hong Kong buying 6.7 billion yuan ($975.00 million) worth of A-shares by lunch break.

** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.86%, while Japan’s Nikkei index rose 0.68%.

** The yuan was quoted at 6.8734 per U.S. dollar, 0.43% firmer than the previous close of 6.9033.

** The largest percentage gainers in the main Shanghai Composite index were Fujian Haixia Environmental Protection Group Co Ltd, up 10.08%, followed by Anxin Trust Co Ltd, gaining 10.07% and People’s Insurance Company Group of China Ltd, up by 10.06%.

** The largest percentage losses in the Shanghai index were Shandong Shida Shenghua Chemical Group Co Ltd, down 10%, followed by Changzhou Langbo Sealing Technologies Co Ltd , losing 9.99% and Sumec Corp Ltd, down by 7.29%.

** The top gainers among H-shares were Huatai Securities Co Ltd, up 6.74%, followed by CITIC Securities Co Ltd , gaining 5.07% and New China Life Insurance Co Ltd , up by 4.74%.

** The three biggest H-shares percentage decliners were Shenzhou International Group Holdings Ltd, which dropped 1.45%, Guangdong Investment Ltd, which lost 1.4% and Sinopharm Group Co Ltd, down by 1.2%.

** As of 0415 GMT, China’s A-shares were trading at a premium of 27.63% over the Hong Kong-listed H-shares.

($1 = 6.8718 Chinese yuan)

Reporting by Luoyan Liu and John Ruwitch, Editing by Sherry Jacob-Phillips

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