February 13, 2019 / 4:48 AM / in 2 months

China, HK stocks gain on respite from trade woes

* .SSEC +0.9 pct , .CSI300 +1 pct , .HSI +0.8 pct, .HSCE + 1.1 pct

* Trump hints at extending trade truce with China; talks underway

* Tech shares extend rally as China focuses on core technology

HONG KONG, Feb 13 (Reuters) - Stocks in China and Hong Kong climbed on Wednesday to multi-month highs after the United States signalled willingness to extend its trade truce with China, while IT shares rallied on Beijing’s promise to push for core technology and innovation. ** At the midday break, the Shanghai Composite index was up 0.9 percent at 2,697.11 points, a level not seen since last November. ** China’s blue-chip CSI300 index rose 1 percent to 3,364.73, its highest point since Sept. 28, 2018. ** CSI300’s financial sector sub-index rose 0.8 percent, the consumer staples sector edged up 0.2 percent, and healthcare shares climbed 0.8 percent. ** Chinese H-shares listed in Hong Kong rose 1.1 percent, while the Hang Seng Index was up 0.8 percent at 28,397.24 points, its highest point since late-August. ** U.S. President Donald Trump said on Tuesday that he could let the March 1 deadline for a trade agreement with China “slide for a little while”, hinting at a possible delay for the first time. ** Trump’s advisers have previously described March 1 as a “hard deadline”, after which U.S. tariffs on $200 billion worth of imports from China will rise to 25 percent from 10 percent, if the two sides cannot reach a deal. ** U.S. Treasury Secretary Steven Mnuchin said on Wednesday he hopes for “productive” trade meetings in China this week. Mnuchin, along with U.S. Trade Representative Robert Lighthizer, arrived in the Chinese capital on Tuesday for talks with Chinese officials. ** The latest round of talks in Beijing kicked off on Monday with discussions among deputy-level officials to try to work out technical details, including a mechanism for enforcing any trade agreement. ** However, if “there is no clear result from the Sino-U.S. negotiations”, “external risks such as volatility in U.S. stocks could transmit into China, which could increase the volatility in the stock market”, analysts at Chuanchai Securities wrote in a note on Wednesday. ** Shares in China’s tech firms extended their rally as Beijing vowed to develop core technologies and innovative capabilities to reduce dependence on foreign technology, and plans to launch a Nasdaq-style start-up board in Shanghai. ** The smaller Shenzhen index was up 1.2 percent and the start-up board ChiNext Composite index climbed 1.5 percent. ** CSI300’s index tracking IT companies rose 3.5 percent, while the CSI telecommunications sub-index jumped 4.1 percent. ** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.5 percent, while Japan’s Nikkei index rose 1.4 percent. ** As of 0400 GMT, China’s A-shares were trading at a premium of 17.24 percent over the Hong Kong-listed H-shares. ** The Shanghai stock index is above its 50-day moving average and below its 200-day moving average. ** In Hong Kong, the sub-index of the Hang Seng index tracking energy shares rose 1.9 percent, while the IT sector dipped 0.1 percent.

Reporting by Noah Sin, Editing by Sherry Jacob-Phillips

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