China and Hong Kong stocks gain ahead of China-US trade talks
HONG KONG: China and Hong Kong stocks edged higher on Monday, led by gains in rare-earth and technology sectors, as investors awaited the high-level US-China trade negotiations in London.
China's blue-chip CSI300 Index climbed 0.3 per cent in early trades, while the Shanghai Composite Index gained 0.4 per cent.
Hong Kong benchmark Hang Seng advanced more than 1 per cent and reclaimed the key 24,000 level, first time since March 21.
Sentiment was cautiously positive, with the US and China set to resume trade talks later in the day. Top US officials including Treasury Secretary Scott Bessent and China's vice premier He Lifeng will meet in London for talks aimed at resolving a trade dispute between the world's two largest economies.
The meeting follows a rare leader-to-leader call between Chinese leader Xi Jinping and US President Donald Trump on Thursday, after weeks of brewing trade tensions and a dispute over critical minerals.
"We think there could be some favourable outcomes from the meeting as Trump has hinted some positive signs," analysts at China Securities said in a note, adding that any progress will offer markets some relief.
The strategically-important rare earth sector, which is expected to be a key focus of the talks, led onshore gains on Monday, up 0.8 per cent.
Technology shares led markets higher in Hong Kong, with the Hang Seng Tech Index rising 2 per cent to a near three-week high.
Chinese stocks have been struggling for direction since the April 2 "Liberation Day", when Trump announced sweeping reciprocal tariffs that threatened to upend the global trade order.
The blue-chip CSI300 Index onshore has barely budged from the April 2 level, and Hong Kong's benchmark Hang Seng Index gained around 2 per cent during the period, both lagging the recovery among major global markets.
Elsewhere, China's consumer prices fell for a fourth straight month in May while producer deflation deepened, as the economy faces headwinds from trade tensions and a prolonged housing downturn.
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