China stocks surge on reports Sino-U.S. trade deal seen soon

Hengan International

04/03/2019 04:53

* SSEC 2.6 pct, CSI300 3.0 pct, HSI 1.2 pct China, U.S.
could sign
trade deal at summit - report
    * China parliament awaited for stimulus, policy news
    * Trade hopes, Trump comments soften dollar, boost yuan

    SHANGHAI, March 4 (Reuters) - Chinese stocks surged on
Monday, adding to recent gains after reports that Washington and
Beijing are close to reaching a deal to end their year-long
trade war, and as China prepared for the opening of its annual
session of parliament.
    At the midday break, China's benchmark Shanghai Composite
was 2.6 percent higher, breaking through the 3,000-point level
to end the morning at 3,073.03 points.
    The index has gained more than 20 percent so far this year.
    The blue-chip CSI300 index  .CSI300  rose even more, adding
3 percent to 3,862.01 points.
    In Hong Kong, Chinese H-shares  .HSCE  rose 1.88 percent at
11,723.25, while the Hang Seng Index  .HSI  was up 1.16 percent
at 29,147.64.
    The smaller Shenzhen index  .SZSC  was up 3.52 percent and
the start-up board ChiNext Composite index  .CHINEXTP  was
higher by 4.71 percent.
    The rise in the Shanghai Composite follows the strongest
weekly gains for the index in more than 4 years last week,
powered by expectations for government stimulus and policy
support, renewed optimism about U.S.-China trade talks, and the
announcement by global index provider MSCI that it will
quadruple the weighting of Chinese A-shares in its global
benchmarks later this year. urn:newsml:reuters.com:*:nL1N20N2BQ urn:newsml:reuters.com:*:nZZN2RIU00
    Zhang Yanbing, an analyst at Zheshang Securities in
Shanghai, said the rally was a continuation of market strength
"prompted by the combination of many favourable factors" that
have emerged since October of last year.
    But he said that the news of a possible forthcoming
agreement between China and the United States, and the opening
of the annual session of China's parliament on March 5 could be
seen as specific factors driving gains on Monday.
    Chinese leaders are expected to set less ambitious targets
for economic growth this year, but Premier Li Keqiang's 2019
work report is expected to offer more assurances of Beijing's
support for small businesses, and plans to boost domestic demand
and safeguard jobs.  urn:newsml:reuters.com:*:nL3N20L097
    Adding to hopes that the U.S. and China might be close to
ending their trade war, the Wall Street Journal reported on
Sunday that U.S. President Donald Trump and Chinese President Xi
Jinping could reach a formal trade deal at a summit around March
27.  urn:newsml:reuters.com:*:nL1N20Q0BF
    That news, and comments from President Trump that a strong
dollar was hurting U.S. competitiveness, helped to lift the yuan
 CNY=CFXS  to 6.688 per U.S. dollar, 0.3 percent firmer than the
previous close of 6.7078.  urn:newsml:reuters.com:*:nL1N20P07T

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
China stock market graphics suite     http://reut.rs/1NfkoGl
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Andrew Galbraith; Editing by Sam Holmes)
 ((Andrew.Galbraith@tr.com; +86 21 6104 1779; Reuters Messaging:
andrew.galbraith.thomsonreuters.com@reuters.net ; Twitter: https://twitter.com/apgalbraith))