HK stocks end at 3-week high on bargain hunting

Hong Kong shares on Thursday hit their highest close in more than three weeks, as investors sought bargains in IT and consumer stocks amid strength in the local currency.

The Hang Seng index was up 1.3% at 26,994.14, its highest close since Nov. 19, while the China Enterprises Index closed 1.1% firmer at 10,614.76.

The Hong Kong dollar strengthened to a five-month high on Thursday, with some analysts attributing the gains to profit-taking as investors unwind lucrative "carry" trades ahead of the year-end.

Such trades involve borrowing in places with low-interest rates, such as Hong Kong, to fund the purchase of potentially higher-yielding assets denominated in U.S. dollars.

Fitch Ratings said Hong Kong's role in global finance remains intact despite unrest.

A calm in the social unrest in the Asian financial hub and optimism over Sino-U.S. trade talks also fuelled some buying interest for some major blue chips, in particular those which have fallen quite a bit in the past, said Steven Leung with UOB Kay Hian in Hong Kong.

Traders are bracing for a series of make-or-break events over the next few days that have the potential to cause huge swings in financial markets for months to come.

China and the United States are in close communication on trade, its commerce ministry said on Thursday, declining to comment on possible retaliatory steps if Washington imposes more tariffs on Chinese goods this weekend.

U.S. President Donald Trump is expected to meet with top trade advisers on Thursday to discuss planned Dec. 15 tariffs on some $160 billion in Chinese goods, three sources familiar with the plans said, as markets braced for potential negative impacts.

Gains in the index were underpinned by IT and consumer shares, with Tencent and Wynn Macau closing up 2.7% and 4.7%, respectively.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.96%, while Japan's Nikkei index closed up 0.14%.

The yuan was quoted at 7.0321 per U.S. dollar at 0810 GMT, 0.09% firmer than the previous close of 7.0386.

At close, China's A-shares were trading at a premium of 26.73% over Hong Kong-listed H-shares.