HONG KONG (Nikkei Markets) -- Hong Kong stocks posted their biggest advance in more than three weeks on Monday as optimism over signs of progress in Sino-American trade discussions helped spur heavyweight companies.
Hopes that Washington and Beijing will sign a preliminary trade agreement this month continued to boost risk appetite. U.S. Commerce Secretary Wilbur Ross on Sunday reportedly said he was "optimistic" the first phase of a Sino-American trade deal will be signed.
Chinese Vice Premier Liu He, U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer had a phone call on Friday. Following the conversation, the U.S. Trade Representative's office and China's Ministry of Commerce said the two sides were making progress.
Meanwhile, U.S. President Donald Trump on Sunday told reporters that a trade agreement, if reached, will be signed in the U.S. The preliminary agreement was earlier meant to be signed by Trump and Chinese President Xi Jinping in Chile during a summit that was canceled due to local unrest.
"The market has already discounted the signing of phase one of a deal, leaving little room for upside," said Steven Leung, executive director at UOB Kay Hian (Hong Kong), adding that he was less bullish on local stocks following recent gains. However, he cautioned that there could still be "a certain degree of uncertainty" related to the discussions.
In the mainland, meanwhile, the Shanghai Composite Index added 0.6%, while the yuan traded onshore strengthened 0.1% against the U.S. dollar to 7.0295.
Shanghai Fosun Pharmaceutical Group, a unit of diversified conglomerate Fosun International, rose 2.7% in Hong Kong after saying it plans to list its Indian unit, Gland Pharma, in Mumbai.
Forgame Holdings slid 6% as trading resumed after being halted on Thursday. The web and mobile game developer said it was unable to contact its chief executive, Li Luyi. Li founded the lending platform Beijing Haitouhui, which, according to Forgame, is reportedly under police investigation.
Property developer China Aoyuan Group rose 4.5% following a 55% year-over-year increase in October contracted sales.
Times China Holdings gained 2%. The developer on Monday reported a 63.9% jump in its contracted sales for October.
KWG Group advanced 2.9%. The developer on Friday reported a more than doubling of its October presales value.
Textile company Texwinca Holdings was up 2.8%. The company's net profit for the April-to-September period rose 8.3% from a year earlier on lower selling and distribution expenses.
-- Benny Kung