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Nikkei Markets

Hong Kong shares edge up, with earnings in focus

AIA Group and China Life Insurance rise after first-half results

HONG KONG (Nikkei Markets) -- Hong Kong shares headed higher on Friday, with major insurers pacing the advance after their interim results.

The Hang Seng Index added 0.5% to 26,173.59 by noon on Friday. Pan-Asia insurer AIA Group added 1.6% after reporting a 73.4% jump in net profit for the first half and a 20% year-over-year increase in the value of its new business. The heavyweight contributed about a third of the gauge's gains by points. China Life Insurance climbed 4% following a more than doubling of its first-half net profit. Net written premiums for the six months ended in June were up 4.8%, it said.

Hengan International Group slid 1.9%, extending Thursday's 5.3% drop after the personal-hygiene products maker reported a 3.6% decrease in net profit for the first half of the year. Revenue for the period increased 6.3%.

Hong Kong's equity benchmark has traded in a narrow 406-point range since Tuesday, as investors contend with a number of headwinds that show few signs of abating. Global risk appetite was hurt last week when a brief inversion of the U.S. yield curve fueled concerns of an impending recession in the world's largest economy. Investors are looking to U.S. Federal Reserve Chairman Jerome Powell's speech at Jackson Hole, Wyoming, on Friday, for clues on whether the central bank will ease monetary policy further after a rate cut in July.

Meanwhile, the outlook for U.S.-China trade relations remains uncertain even as the administration of President Donald Trump signaled it is still planning a round of talks with China in September. White House economic adviser Larry Kudlow on Thursday said a call between deputy-level trade negotiators this week was "quite constructive."

"Sentiment is still cautious," said Stanley Chik, head of research at Bright Smart Securities. "Sino-American trade negotiations are still the biggest variable. It remains uncertain whether they can kick-start a new round of talks in September."

In the mainland, the Shanghai Composite Index rose 0.5% by midday, while the yuan traded onshore slipped 0.1% against the dollar to 7.0930.

Supply-chain and logistics major Li & Fung jumped 5% in Hong Kong after reporting a profit of $20.53 million for the first half of the year, compared with a net loss of $86.09 million a year ago. Revenue fell 8.4% to $5.36 billion.

Anhui Conch Cement rose 0.6% after reporting a near 18% increase in first-half net profit and a 56.6% jump in revenue.

Hisense Home Appliances climbed 6.9% after reporting a 21% increase in net profit for the first half of the year.

-- Benny Kung

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