SHANGHAI: China stocks closed up on Monday as signs of easing Sino-US tensions boosted investor sentiment. Tech shares led Hong Kong stocks up. China’s blue-chip CSI300 Index closed up 0.2%, while the Shanghai Composite Index gained 0.5%.

Hong Kong’s benchmark Hang Seng Index was up 1.9%. James Wang, head of China strategy at UBS, held a positive view towards China’s equity market in 2024, projecting a 15% upside to the MSCI China index, given the current market’s trough valuation, low investor positioning and accelerating policy support.

Wang prefers shares traded in Hong Kong over China’s onshore shares and likes the internet sector the most.

Also helping lift investor sentiment are some signs of tensions easing between the world’s two largest economies. Last week’s meeting between US President Joe Biden and Chinese President Xi Jinping is a badly needed signal that the world needs to cooperate more, International Monetary Fund Managing Director Kristalina Georgieva said on Friday.

Foreign capital recorded a net inflow of 1.4 billion yuan ($194.15 million) via a northbound trading link after the past two weeks had seen mostly outflows.

China left benchmark lending rates unchanged at a monthly fixing on Monday, matching market expectations. A lower lending rate would help the troubled property sector but will add pressure on banks as their net interest margins were already tight, analysts said.

CSI Financials Index edged up 0.1%. Healthcare and tourism stocks were up 1.2% and 1.6%, respectively. In Hong Kong, tech stocks rallied 2.5%, with Tencent up 3.6%. Shares of property developer Sunac China Holdings jumped as much as 11.8% after the company’s offshore debt restructuring became effective.