China, Hong Kong stocks rise on policy steps to ease price wars
China's blue-chip CSI300 Index.CSI300 climbed 0.7% by the lunch break, while the Shanghai Composite Index.SSEC gained 0.6%. Hong Kong benchmark Hang Seng.HSI was up 0.8%.
The market reaction in Asia was rather muted after US President Donald Trump on Monday began telling trade partners - from powerhouse suppliers like Japan and South Korea to minor players - that sharply higher US tariffs will start on August 1, marking a new phase in the trade war he launched earlier this year.
China's top leaders pledged last week to step up regulation of aggressive price-cutting by Chinese companies, as the world's second-biggest economy struggles to shake off persistent deflationary pressures.
Shares of solar manufacturers led gains onshore, with Tongwei 600438.SS up 10%, after China's industry ministry pledged to curb disorderly low-price competition in the photovoltaic industry.
Deeper policy efforts to curb excessive competition are expected to help rebalance industrial supply and demand, support a rebound in producer prices, and improve long-term earnings expectations for A-shares, analysts at Huaxi Securities said in a note.
Semiconductor shares.CSIH30184 also rose, up 1.1%, as a slew of companies posted upbeat profit alerts.
Consumer-related shares climbed in Hong Kong, as subsidies from food delivery platforms boosted consumer demand. Xiabuxiabu 0520.HK, a hotpot restaurant, rose nearly 7%.
Hang Seng Tech Index HSTECH was up 1.3%.
Traders are watching for China's key inflation data due on Wednesday to gauge the health of the world's second-largest economy in the face of persistent deflation pressure and trade risks.
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