HONG KONG (Nikkei Markets) -- Hong Kong stocks posted their steepest weekly rise in nearly three months on Friday on the back of gains by Geely Automobile Holdings and technology companies, although caution over U.S.-China trade relations affected trading volumes.
The Hang Seng Index rose 1% to end at 31,122.06, taking its weekly advance to 4%. Forty-eight of the index's 50 members climbed over the five-day period. Geely was the week's top performer with a 12.7% increase, while AAC Technologies Holdings added 9.2% and Sunny Optical Technology Group advanced 8.2%. In Friday's trading, Geely rose 3.7%, AAC added 1.8% and Sunny Optical slipped 0.7%.
Turnover on the stock exchange's main board has been lower recently due to smaller inflows over the city's trading links with Shanghai and Shenzhen, tensions over trade relations between the world's two largest economies, and worries about rising U.S. interest rates. About 100 billion Hong Kong dollars ($12.7 billion) worth of local stocks changed hands on Friday.
Stanley Chik, head of research at Bright Smart Securities in Hong Kong, said the strong performance of Chinese technology companies in U.S. trading on Thursday, as well as hopes surrounding Tencent Holdings' earnings, expected next week, were pushing the Hang Seng Index higher.
Still, "the main board turnover has not been increasing lately, showing that investors are still cautious," Chik said. "Low investor participation could limit the room for further gains."
The Shanghai Composite Index fell 0.4% on Friday, while the yuan traded onshore strengthened 0.2% to 6.3327 against the U.S. dollar. The Nikkei Asia300 Index of regional stocks outside Japan added 0.9%.
Insurer AIA Group rose 2.4% and was the top contributor to the Hang Seng Index's gains by points on Friday amid expectations for its growth outlook in China. Social-media and gaming major Tencent added 0.6%.
Diversified conglomerate Swire Pacific advanced 3%. Shares of its unit Swire Properties jumped 4.9% to a record high after the developer on Thursday said it is in discussions that may result in the sale of two office towers in Hong Kong.
Q Technology Group was a notable decliner as it tumbled 30.3%, its biggest single-day drop ever, after the company warned that its profit before tax for the six months ending June 30 is expected to drop by 50% or more from a year ago.
Hua Hong Semiconductor fell 5%, trimming this week's gains to 2.8%. The company on Thursday said it expects first-quarter profit to rise 18.1% year-over-year to $40.2 million, adding that revenue for the second quarter was projected to increase by 5% to 7%.
-- Amy Lam