China says US attempts to damage China's interest will be countered

China's foreign ministry spokesman Zhao Lijian said Beijing will resolutely defend its security and development interests. PHOTO: REUTERS

BEIJING (REUTERS, BLOOMBERG) - China on Monday said that US attempts to harm Chinese interests will be met with firm countermeasures, criticising Washington's decision to end special treatment of Hong Kong as well as actions against Chinese students and companies.

Foreign ministry spokesman Zhao Lijian told reporters on Monday (June 1) during a briefing that both countries stand to benefit from bilateral cooperation but said Beijing will resolutely defend its security and development interests.

Despite the heated rhetoric between both sides, investors seemed undeterred.

Hong Kong stocks headed for their best day in more than two months, after President Donald Trump's response to China for its crackdown on Hong Kong stopped short of fully escalating tensions between the two nations.

The Hang Seng Index was up 3.5 per cent by 2:55pm local time on Monday. Real estate firms, which had borne the brunt of selling in recent days, led the rally.

While Trump's speech last Friday (May 29) was stern, it lacked specifics around measures that would directly impact the city.

He announced the US would begin the process of stripping some of Hong Kong's privileged trade status without detailing how quickly any changes would take effect and how many exemptions would apply.

"Trump's comments gave no immediate measures on Hong Kong and leave room for negotiations with Beijing," said Castor Pang, head of research at Core Pacific- Yamaichi International.

"Trump's comments have eased investors' concern about the impact of potential sanctions on the Hong Kong economy."

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