Chinese and Hong Kong stocks gained on Thursday morning, as investors were encouraged by China's solid trade data and Federal Reserve Chair Janet Yellen's signal to adopt a patient approach in the current US rate-tightening phase.
China's blue-chip CSI300 index rose 0.5 per cent, to 3,676.07 points by the lunch break, on track to close at a 1-1/2-year high. The Shanghai Composite Index gained 0.4 per cent to 3,211.51 points.
In Hong Kong, the benchmark Hang Seng index jumped 1.1 per cent to 26,323.33 points - a fresh two-year-high, while the Hong Kong China Enterprises Index gained 1.5 per cent to 10,678.43.
But start-ups in both markets underperformed. China's small-cap board
Trade data
The market was inspired by better-than-expected China trade data for June. Exports rose 11.3 per cent last month from a year earlier, while imports expanded 17.2 per cent, suggesting the economy is holding up well thanks to firmer global demand.
“Today's upbeat figures point to still strong foreign demand for Chinese goods, as well as fairly resilient domestic demand," said Julian Evans-Pritchard, China Economist at Capital Economics.
“Looking ahead, exports should continue to do well given the relatively positive outlook for China's main trading partners.”
Yellen's testimony
Risk appetite also improved after Wall Street hit record peaks as investors wagered policy tightening in the United States would be glacial at best.
Chinese investors continued to plow money into blue chips, helping lift sectors such as banking, raw materials and infrastructure.
“Mainland investors are increasingly ditching speculative trading, and putting money in those companies that generate predictable incomes,” said Wu Wei, analyst at Zheshang Securities Co.