HONG KONG: Asian markets rose Wednesday, led by a surge in Hong Kong after reports said the city's leader was considering agreeing to a key demand of pro-democracy protesters, fuelling hopes for an end to months of damaging protests in the financial hub.
Shares rallied across the board on the Hang Seng Index after the reports, with property and retail firms among the best performers, having taken a hiding over the past few weeks as the demonstrations were increasingly dogged by violence.
Chief Executive Carrie Lam and Beijing have refused to make any concessions to the protesters beyond agreeing to suspend a loathed extradition bill, a move that fell far short of demands to permanently shelve it.
"The withdrawal is a sign of an inflection point in the 13-week-long crisis," Justin Tang, head of Asian research at United First Partners, said.
"Retail and property stock investors are signalling their optimism and putting their money where it matters." Hong Kong -- which has more than a tenth of its value over the past three months, partly because of the protests -- soared 3.4 percent in afternoon trade, while Shanghai ended 0.9 per cent higher.
Most other Asian equity markets also rose after two days of stuttering, with dealers brushing off the latest China outburst from Donald Trump.
The president threatened China that if it did not move quicker in negotiations it would get a worse trade deal from him if he won the 2020 election.
The tweet came as reports said the two sides were struggling to agree on parameters for the next round of talks, which Trump had said would go ahead this month.
Beijing's point man in the talks, Vice Premier Liu He, met two Republican senators Steve Daines and David Perdue on Tuesday in the Chinese capital and said he wanted a negotiated resolution based on "equality and mutual respect", state news agency Xinhua reported.
On other markets Tokyo ended 0.1 per cent higher, Singapore added 1.4 per cent, Seoul climbed 1.4 per cent and Taipei added 0.9 per cent.
Manila, Wellington, Mumbai and Bangkok also posted strong gains. In early trade, London rose 0.3 per cent, Paris gains 0.8 per cent and Frankfurt was up one per cent.
The broad gains also came despite a shock drop in US factory activity into contraction -- the first time since Trump came to power and raising concerns about the state of the world's top economy.
The figures come days before the release of the closely watched jobs data on Friday, which is poured over for an idea about the Federal Reserve's plans for monetary policy with observers tipping it to cut interest rates again at some point.
The pound continued its recovery from Tuesday's plunge, with Britain preparing for another general election.