Hong Kong stocks rose following an easing of some geopolitical concerns after US president-elect Donald Trump strongly indicated that he would like Chinese video app TikTok to continue operating in the country.

The Hang Seng Index rose 0.8 per cent to 19,870.36 in afternoon trading. The benchmark dropped 1.3 per cent last week. The Hang Seng Tech Index gained 0.5 per cent.

Trading in Hong Kong will be curtailed this week because of the Christmas holiday, with investors staying on the sidelines. The turnover on Monday was 17 per cent below the 30-day average, according to Bloomberg data. The exchange will remain open for half a day on Tuesday and will be shut on Wednesday and Thursday.

On the mainland, the CSI 300 Index climbed 0.7 per cent and the Shanghai Composite Index retreated 0.1 per cent.

Stocks at the centre of US-China tensions advanced. Semiconductor Manufacturing International Corp (SMIC) rose 3.9% and WuXi Biologics rose 2.5 per cent.

In a speech to conservative supporters in Phoenix, Arizona, Trump said he opposes a potential exit of TikTok from the US market, showing his rapidly changing stance on the popular social media app. The US Senate passed a law in April requiring TikTok’s Chinese parent company, ByteDance, to divest the app, citing national security concerns.

Chinese Investors Buy Record Amount of Hong Kong Stocks Via Link

Mainland Chinese investors snapped up a record amount of Hong Kong stocks as they ramped up exposure to risk assets in the city amid a revival of animal spirits and a weakening yuan.

Traders in Shanghai and Shenzhen bought HK$778 billion ($100 billion) of stocks in the financial hub this year through Dec. 20, the highest annual amount since trading links with the city opened in 2016, according to Bloomberg-compiled data. Shares in Alibaba Group Holding Ltd., Bank of China Ltd. and China Mobile Ltd. were among the most purchased.

Onshore investors boosted their share of trading in the city to a record 45% in the fourth quarter as Beijing’s stimulus blitz propelled benchmark gauges. Other factors leading to the unprecedented southbound buying include a weaker yuan, creating an appetite for dollar assets, said Zeng Wenkai, managing director at Shengqi Asset Management Co.

“The determining factor in how Hong Kong’s market fares going forward lies in the balance between the demand by onshore investors and pressure from outflows by global funds,” said Zeng. In the short term, though, it’s unlikely for Chinese investors to be the biggest holders of the city’s equities, he said.

Onshore traders have bought a cumulative HK$3.3 trillion of Hong Kong shares since the trading link began.