Chinese shares climb ahead of Trump-Xi summit

China's Shanghai Composite index and Hong Kong's Hang Seng Index surged 0.6% on Monday, buoyed by optimism surrounding potential trade truce extension between the US and China. The two leaders, President Donald Trump and Chinese President Xi Jinping, are set to meet this week. By midday, the Shanghai Composite index reached 3,933.37 points, while China's blue-chip CSI300 index climbed 0.4%.

The ChiNext Composite index, which focuses on startups, rose 0.9%, while Shanghai's tech-focused STAR50 index gained 0.4%. The CSI AI Index also jumped by 1.1%. Tech shares benefited from US Treasury Secretary Steve Bessler and Chinese Vice-Premier He Lifeng's talks in New York, which resulted in a proposed AI safety notification mechanism.

Analysts at Goldman Sachs anticipate both sides will aim to maintain relative stability in US-China relations, though a comprehensive bilateral agreement seems unlikely. Notable gainers included the real estate sector, which rose 4.6%, and the defense sector, which added 1.7%. In Hong Kong, the benchmark Hang Seng Index was up 0.6% at 24,891.58, while the Hang Seng Tech Index remained flat.

Markets across Asia saw gains as chipmakers rose, while oil prices dipped due to indications that more oil was exiting the Middle East than initially believed, despite ongoing conflict in the region.