HONG KONG (Nikkei Markets) -- Hong Kong shares headed higher on Monday, as President Donald Trump's comments that the U.S. is working well with China on trade matters eased concerns of escalating tensions between the two nations.
The Hang Seng Index added 1.3% to reach 31,521.82. Apple suppliers Sunny Optical Technology Group and AAC Technologies Holdings were the top percentage gainers on the gauge, rising 8.7% and 4.2%, respectively.
Tencent Holdings, which is to report its March quarter results on Wednesday, rose 1.2%. Financial heavyweights were among the biggest contributors to Monday morning's advances. AIA Group and Ping An Insurance Group each climbed 2.3% while mainland lenders China Construction Bank (CCB) and Industrial & Commercial Bank of China (ICBC) added 1.2% and 1.5% respectively.
Most Asian equity markets rose after Trump tweeted that China and the U.S. are working well together on trade, even as he highlighted that past negotiations have been "one-sided in favor of China." The tweet came after talks in Beijing earlier this month ended inconclusively. In addition, the U.S. president said he is working with Chinese President Xi Jinping to help telecommunication-equipment maker ZTE find "a way to get back into business."
In April, the U.S. Department of Commerce banned American companies from making sales to China's ZTE after it allegedly sold equipment to North Korea and Iran.
Daniel So, a strategist at CMB International Securities, said Trump's comments alleviated broader concerns of a trade war, adding that smartphone suppliers were gaining on his comments on ZTE. "At least the negotiations on ZTE bore some fruit while negotiations on other matters may take some more talks to resolve," he said. The Hang Seng is likely to move towards 32,000 points near term, he added.
In the mainland, the Shanghai Composite added 0.6% while its Shenzhen counterpart edged 0.2% higher.
Global Brands Group tumbled 8.2% in Hong Kong after the fashion retailer said it expects to report a net loss of $70 million to $75 million for the year ended March 31, compared with a net profit of about $90 million a year earlier.
Union Medical Healthcare rose 2.2% after the aesthetic medical service provider said that an Asia-focused private equity fund operated by OrbiMed Advisors had acquired 63.8 million shares, equivalent to a 6.49% stake.
Bullion-and-diamond trader King Fook Holdings advanced 2.2% after saying it expects to report a "significant decrease" in its loss for the year ended March 31 from a year earlier.
Construction-materials company Cherish Holdings fell 4.3% after saying it expects to report a "substantial" decrease in revenue and net profit for the year ended March 31.
Pacific Textiles Holdings slid 3.1% after saying it expects about a 25% drop in profit for the year ended March 31.
-- Amy Lam
