HK, Shanghai Rise On Mainland Financial Market Boost

Hong Kong stocks ended on Monday morning more than 1 percent higher, building on last week's rally while mainland markets jumped, helped by a massive cash injection into financial markets by the Chinese central bank.

The Hang Seng Index jumped 1.3 percent, to 25,505.

The benchmark Shanghai Composite Index soared 2.3 percent, to 3,436, while the Shenzhen Composite Index gained 1.8 percent, to 2,284.

This comes as People's Bank of China issued medium-term loans worth 700 billion yuan to financial institutions, rolling over 550 billion yuan of such loans maturing in August and injecting a further 150 billion and leaving borrowing costs unchanged.

Other Asian markets were mixed as investors weighed ongoing China-US tensions and Washington lawmakers' struggle to hammer out a much-needed new stimulus.

Tokyo dropped 0.6 percent by lunch after data showed Japan's economy contracted the most on record in the second quarter, while Sydney and Manila were also in the red.

Taipei was also up more than 1 percent and Singapore 0.5 percent, while Wellington piled on 1.5 percent after the government delayed New Zealand's general election by four weeks to October 17 owing to a spike in new virus infections.

Meanwhile, high-level talks between China and the US on their "phase one" trade agreement were called off, though observers said the decision was down to scheduling issues and that there was no concern for now about the future of the agreement, with both sides last week saying it would stay in place.

"For now there is no sign the trade deal is in jeopardy, with the review's postponement seen as an allowance for China to increase its purchase of US agricultural goods, which are way behind schedule" owing to the impact of the virus on trade, said National Australia Bank's Rodrigo Catril. (AFP, Reuters)

______________________________