HONG KONG: China and Hong Kong stocks rose on Thursday as rare earth and tourism shares rallied, and signs of easing US-China tensions lifted investor sentiment.
The Shanghai Composite index climbed up 0.7% to 3,605.73, the highest close since January 2022. It is now on track to register a fifth week of gain, which would mark its longest winning streak in nearly one and a half years.
The blue-chip CSI300 index was also up 0.7%.
Leading gains onshore, the rare earth sector surged 5.2% to a fresh three-year high. The tourism sector rose 3.4%, while China tourism group duty free index jumped by the 10% daily trading limit following a launch plan for the Hainan Free Trade Port.
In Hong Kong, the Hang Seng Index added 0.5% to 25,667.18, the highest close since November 2021.
Chinese stocks have been steadily rising in recent weeks, buoyed by Beijing’s efforts to curb excessive competition and overcapacity and signs of improving US-China trade relations.
The Shanghai Composite Index has surged nearly 19% from its most recent low in April, nearing the 20% gain used to define a technical bull market.
“Although there hasn’t been any unexpected change in the top-down macroeconomic picture, there are still many structural opportunities within the stock market,” analysts at Cinda Securities said in an note.
Fresh signs of easing US-China trade tensions also helped lift sentiment. President Donald Trump said on Wednesday that the United States was in the process of completing a trade deal with China.
Around the region, MSCI’s Asia ex-Japan stock index was up 0.3%, while Japan’s Nikkei index gained 1.6%.