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Nikkei Markets

Hong Kong shares edge higher ahead of trade talks

China Life gains on jump in monthly premium income

HONG KONG (Nikkei Markets) -- Hong Kong shares eked out small gains in Tuesday's morning session after logging their biggest advance in more than three weeks the previous day, with investors awaiting the next round of trade talks between the U.S. and China.

The Hang Seng Index was up 0.1% at 28,368.65 by noon after rising as high as 28,488.97 earlier. It briefly retreated during the session. China Life Insurance jumped 4.1% after reporting a 24.4% increase in January accumulated premium income. The stock was the second-biggest contributor to the gauge's gains by points. China Shenhua Energy added 0.3%. The miner on Monday said coal sales volume in January fell 25.9% on year to 26 million tons.

Turnover on Hong Kong's main board was at about HK$55 billion ($7 billion) by the midday break, more than usual for the time of day.

U.S. financial markets were closed on Monday for Presidents Day. A fresh round of trade talks between the U.S. and China is due in Washington on Tuesday. Chinese Vice Premier Liu He will visit America to continue the trade talks, China's Ministry of Commerce said in a statement. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will continue to represent the U.S.

The Hang Seng Index, which rose 1.6% on Monday, is up nearly 10% so far this year amid optimism over a resolution to Sino-American trade tensions, hopes for policy stimulus from China and receding worries about U.S. interest rates. In the mainland, the Shanghai Composite Index rose 0.3%, while the Shenzhen Composite Index added 0.2%. The yuan traded onshore slipped 0.1% against the dollar to 6.7743.

"A pickup in A-shares may support H-shares, but it probably won't lead the Hang Seng Index much higher," said Linus Yip, chief strategist at First Shanghai Securities. He said mainland Chinese equity indexes could outperform the Hang Seng Index in the short term.

Fosun International added 0.2% after saying it subscribed to 3.85 million new shares issued by German fashion retailer Tom Tailor for 8.7 million euros ($9.8 million) and would make a voluntary takeover offer for the shares it doesn't already own. After the subscription. Fosun's stake in Tom Tailor will rise to 35.35% from 28.89%.

Smartphone components supplier Q Technology Group jumped 8.9% in Hong Kong after reporting a 72% jump in total sales volume for its camera modules in January.

New China Life Insurance added 2.7% following a 6.9% increase in accumulated gross premium income for January.

Guangdong Yueyun Transportation fell 1.3% after saying it received notice that China Securities Regulatory Commission had suspended the review process of its application for an A-share offering. Yuexiu Transport Infrastructure rose 3.7% after reporting an 11.2% increase in 2018 net profit and a 5.3% gain in revenue.

Property management services provider Xinchengyue Holdings added 0.4% after saying it expects consolidated net profit for 2018 to have risen at least 90% from a year ago.

CGN New Energy Holdings fell 0.9% after reporting a 0.3% decline in January electricity sales.

-- Amy Lam

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