China's blue-chip stocks log best day in a month ahead of Trump-Xi meeting; Hong Kong rises

SHANGHAI, Sept 18 (Reuters) - China stocks rebounded on Friday with the blue-chip CSI300 Index .CSI300 logging its best day in a month, while Hong Kong shares also gained as traders expect trade tensions to ease after next week’s meeting between the U.S. and Chinese presidents.

** China’s large-cap CSI300 Index .CSI300 closed 1.1% higher, posting its biggest one-day gain since mid-August. The Shanghai Composite Index .SSEC rose 0.9%.

** In Hong Kong, the Hang Seng Index .HIS climbed 0.6%.

** For the week, CSI300 was largely flat, the Shanghai Composite edged up 0.6%, while the Hang Seng fell 0.2%.

** U.S. President Donald Trump will welcome his Chinese counterpart Xi Jinping in Washington next week for their second meeting this year, as the two leaders seek stability in a fraught relationship.

** U.S. Trade Representative Jamieson Greer said this month the countries will make "some ‌announcements on agriculture and non-tariff barriers". Traders will be watching for progress on an agreed mutual tariff reduction covering $30 billion in goods.

** With a U.S. rate hike also in the rear view mirror, “the external risks have weakened”, Great Wall Securities said in a note.

** Bets on China’s AI and chipmaking sectors are still advisable, the brokerage said.

** Goldman Sachs said that despite China’s economic headwinds from weak domestic demand, “we continue to see several bright spots in the economy, including the global expansion of Chinese companies.”

** Real estate stocks .CSI000952 rallied 7%, led by China Vanke 000002.SZ, which surged 10%.

** Chipmaking and AI stocks also jumped.

** The CSI Integrated Circuits Index .CSI932087 rose 4%, while the CSI AI index .CSI930713 gained 3%.

** Semiconductor and AI stocks led gains in Hong Kong.

** However, energy .HSCIE.CSIEN and consumer .CSI000912 shares weakened in both markets, reflecting investors’ preference for “new economy” stocks.