SHANGHAI — Hong Kong shares closed higher on Friday as news of a “candid” call between U.S. President Joe Biden and his Chinese counterpart Xi Jinping boosted sentiment.
** The Hang Seng index rose 1.9%, to 26,205.91, while the China Enterprises index gained 2.2% to 9,386.84 points.
** For the week, the Hang Seng index and the China Enterprises index ended higher 1.2% and 1.0%, respectively.
** Biden and Xi spoke on the phone for the first time since February, and both discussed the need to avoid letting competition between the world’s two largest economies veer into conflict, a senior U.S. official said.
** The official said the tone of their conversation was both “familiar” and “candid,” and Chinese state media described it as “a broad, candid, in-depth and strategic conversation.”
** “There were some small market moves after the news of the call, but it’s not a fundamental change, markets are still more concerned about Fed tapering and China regulation,” said Gary Ng, an economist at Natixis in Hong Kong.
** The Hang Seng Tech index rebounded 2.9% after falling the most in six weeks in the previous session as authorities summoned gaming firms to ensure they implement new rules for the sector.
** “Faced with growing regulatory uncertainty in domestic gaming, we expect Chinese gaming companies to speed up international market expansion, which is supported by the government, and could be a long-term margin driver,” Chelsey Tam, senior equity analyst at Morningstar, said.
** Tech giants Meituan and Alibaba Group both jumped 4.3%, while Tencent Holdings added 2.1%.
** The Hang Seng Finance index and the Hang Seng Commerce & Industry index advanced 1.8% and 2.2%, respectively. (Reporting by Shanghai Newsroom; Editing by Shounak Dasgupta)