HSI Edges Higher On Bargain Hunting

Asian markets rose Thursday on bargain-hunting by investors following a week of heavy losses due to anxiety over the deepening China-US trade war.

But tensions remained high, prompting a rush on safe-haven assets such as bonds, gold and the Japanese yen.

Here in Hong Kong, the Hang Seng Index gained half a percent to end the day at 26,120.

Shares of power equipment maker Techtronic Industries stood out, surging just over 4 percent.

Geely shares rallied 3.9 percent after the mainland car manufacturer posted a rise in July sales.

Across the border, shares snapped a six-day losing streak. The blue-chip CSI300 index rallied 1.3 percent and the Shanghai Composite Index added 0.9 percent.

Regional markets were higher as well.

In Tokyo, the Nikkei gained 0.4 percent, after shedding more than 1,000 points in a four-day losing streak. The market in Taiwan rose 1 percent. South Korea gained 0.6 percent. But Singapore slipped 0.6 percent.

Equities had tumbled Monday after Beijing allowed the yuan to slide sharply against the dollar following US President Donald Trump's announcement that he would impose 10 percent tariffs on another $300 billion in Chinese goods starting September 1.

But Beijing's move to stabilise the yuan after both onshore and offshore rates dropped below the key 7 per dollar threshold helped to ease investor fears.

Even though the central bank set the currency's central parity rate above 7 for the first time in 11 years on Thursday, analysts were unruffled, saying the yuan fix was stronger than expected.

"The fact that it's only gone through 7 today and it didn't on Tuesday really tells you that they are signalling to the market that we don't want the currency to depreciate too quickly", said Julian Evans-Pritchard, senior China economist at Capital Economics.

"They don't want a very sharp, sudden move weaker that could result in a big jump in capital outflow. So they are trying to effectively manage the process and engineer a gradual depreciation," he said. (additional reporting by AFP)