Shanghai shares soar to 5.60% after Trump delays tariff hike

Trump’s delay in tariffs is also due to China’s loose monetary conditions, supportive economic policies and the inflow of foreign funds. (Reuters pic)

BEIJING: China’s stock markets surged by more than 5% on Monday after US President Donald Trump said he would delay an increase in tariffs on Chinese goods following “substantial progress” in trade talks.

The benchmark Shanghai Composite Index climbed 5.60%, or 157.05 points, to 2,961.28, while the Shenzhen Composite Index, which tracks stocks on China’s second exchange, rallied 5.42%, or 80.02 points, to 1,557.27.

Loose monetary conditions, supportive economic policies and the inflow of foreign funds contributed to the positive mood in the markets, said Zhang Qi, an analyst of Haitong Securities.

“Positive signals from China-US trade talks and the continuous rally in recent few days reinforced investors’ optimistic sentiment,” Zhang said but added that investors should be wary of accompanying risks, considering there are still uncertainties regarding internal and external factors.

Securities firms led the gains. CITIC Securities closed the maximum allowed 10% higher at

24.67 yuan and Sinolink Securities also rose by the limit to close at 10.51 yuan.

China Life Insurance jumped by the maximum to 28.56 yuan and Ping An Insurance rallied 8.92% to 73.00 yuan.

Tech companies surged on the news that Huawei unveiled a 5G foldable smartphone on Sunday.

Telecoms giant ZTE added 8.87% to 30.31 yuan and optical products manufacturer Lens Technology closed 7.01% higher at 9.01 yuan.