(Bloomberg) -- Hong Kong stocks climbed after the government suspended a controversial extradition bill that spurred some of the city’s biggest protests in decades.

The Hang Seng Index was up 1% as of 10:30 a.m. local time, with property developers leading gains. The index slumped 2.4% in the previous three trading days, the worst performance among 94 global gauges, amid concern about the worsening political environment and tightening liquidity. A Hang Seng gauge of Chinese companies rose 0.6%

A march on Sunday was peaceful and prompted Hong Kong Chief Executive Carrie Lam to issue a formal apology. The Civil Human Rights Front said more than a quarter of the island’s 7.5 million residents responded to its call to march. Police said some 338,000 joined the protest’s main routes during the peak.

“The Hong Kong market is having a relief rally,” said Ben Kwong, executive director at KGI Asia Ltd. “People were worried that the protest would escalate. Now that the government has stepped back, at least the tensions should be easing.”

Geely Automobile Holdings Ltd. was among the top performers on the Hang Seng Index, advancing 2.3% after Citigroup Inc. said Chinese automaker stocks could get a boost from May sales data. Developers Wharf Real Estate Investment Co. led the gains with a 4% rally and New World Development Co. rose 3.5%.

“It’s clearly not a positive, but the pulling of the bill should suit investors,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney. “Last week’s pullback means the HSI is defensively positioned, given rises in other global markets.”

The market’s focus will now shift from the local political tensions to the U.S. Federal Reserve’s potential rate cuts, KGI’s Kwong said. “It’s very likely for the Fed to cut rates in July, and that would be good for the Hong Kong market. With the G-20 meeting coming up as well, investors will also be watching for the likelihood of a new trade negotiation.”

The Group of 20 summit will take place in Osaka later this month, where President Donald Trump is expected to meet his Chinese counterpart Xi Jinping. The Shanghai Composite Index edged up 0.2% Monday and the yuan was little changed.

To contact the reporters on this story: Livia Yap in Singapore at lyap14@bloomberg.net;Jeanny Yu in Hong Kong at jyu107@bloomberg.net;Magdalene Fung in Hong Kong at sfung76@bloomberg.net

To contact the editors responsible for this story: Richard Frost at rfrost4@bloomberg.net, Will Davies

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