Both the blue-chip CSI300 index and the Shanghai Composite Index ended the session up 1.3%, at 3,848.32 points, and 2,924.11 points, respectively. The yuan dipped roughly 0.15%.
Investors drew confidence from solid corporate earnings, as well as a surprise expansion in a private survey's calculation for August factory activity.
Investors' calm suggests the trade war's impact on Chinese markets has largely been priced in. Also helping may have been Beijing's vow over the weekend to invigorate capital markets, as well as expectations of the authorities' willingness to intervene ahead of the China's National Day Holiday on Oct 1.
"After being hit repeatedly by trade frictions, Chinese capital markets are reacting to this risk factor in an obviously blunted manner," said Cheng Shi, chief economist at ICBC International.
Instead, U.S. stocks are more vulnerable to a sharp sell-off at the moment, he added.
The United States on Sunday began imposing 15% tariffs Chinese goods, including footwear and smart watches, as China hit back with duties on U.S. crude, marking the latest escalation in their year-long trade war.
China's stock market lost a quarter of its value in 2018 under the weight of the trade war, but is up 17% so far this year, with domestic investors appearing increasingly immune to bad news from trade talks.
Gerry Alfonso, analyst at Shenwan Hongyuan Securities, said in a note that "given the macro environment, there were some concerns about the earnings season in many sectors, such as home appliances, but those earnings did come within market expectations".
Stronger infrastructure spending may be helping manufacturers to some degree, but given continued domestic and export weakness "we think authorities will have little choice but to roll out further policy easing measures in the coming months," Capital Economics said in a note.
Wu Kan, head of equity trading at Shanghai-based Shanshan Finance, said he expects the government to help stabilize the market ahead of the politically key National Day holiday.
The yuan also showed some signs of steadying after its worst monthly slide in 25 years in August as the trade dispute intensified. The Chinese currency changed hands at 7.1703 per dollar in late afternoon trading, little moved from Friday's close.
Ming Ming, head of fixed income research at CITIC Securities in Beijing, said the yuan could weaken further if there is no solid progress in Sino-U.S. trade negotiations.
"But in the long term, the yuan will certainly have two-way fluctuations around its balanced levels. And the central bank will pay close attention to avoid an overshoot in its exchange rate," Ming said.
The People's Bank of China (PBOC) set the midpoint rate at 7.0883 per dollar prior to the market open, the weakest since March 13, 2008, but only 4 pips weaker than Friday's fix.
The guidance rate was stronger than markets had expected for the fifth session in a row, which traders see as an official attempt to slow the currency's decline.
"The PBOC continued to use its counter-cyclical factor heavily in the midpoint setting," said a trader at a Chinese bank. "The spot yuan is likely to consolidate at current level."
In Hong Kong, Hang Seng index dropped 0.4% to 25,626.55 points after another weekend of violent protests and as demonstrators targeted the financial hub's airport again.
The Hong Kong China Enterprises Index was little moved at 10,103.36.