Stocks pare losses, Sino-American talks help

China stocks pared their losses on Monday after reports emerged that the US and China have started talks to improve US access to Chinese markets, easing fears of a trade war between the two economic giants that have rocked global markets over the past week.

At the close, the Shanghai Composite Index was down 0.60 percent at 3,133.72 points, while the blue-chip CSI300 index also lost 0.64 percent at 3,879.89 points.

They were off intraday lows as E-Mini futures for the S&P 500 jumped more than 1 percent.

China’s Ministry of Foreign Affairs said on Monday that the country is willing to hold talks with the US to resolve their differences in a hopeful sign a potentially damaging trade war could be avoided.

“The China-US trade spat could prompt [the Chinese government] to push forward with an innovation strategy as it puts more focus on the quality of its economy,” said Chen Xiaopeng, an analyst with Sealand Securities.

The tech-heavy start-up board ChiNext jumped 3.16 percent, led by semiconductor companies and biological product makers.

As part of efforts to foster new growth drivers, the Export-Import Bank of China and the country’s top economic planner have signed an agreement to boost financing support to emerging industries by more than $100 billion on Friday.

In other areas of the stock market, sentiment was still soured by fears of a China-US trade war.