A student sustains an eye injury which demonstrators blamed on a bean-bag round fired by Hong Kong police during a school boycott rally at the Chinese University of Hong Kong on Monday. (AFP)

Hong Kong’s stock market soared Wednesday after local media reported that the city’s embattled leader is planning to fully withdraw a loathed extradition bill, one of the main demands of pro-democracy protesters.

The Hang Seng index leapt more than three percent in afternoon trade after the South China Morning Post and HK01 both published reports that the city’s pro-Beijing chief executive, Carrie Lam, was planning to shelve the bill.

Tokyo’s benchmark Nikkei index, meanwhile, edged up as a weak yen prompted late bargain hunting, but investors remained concerned over a potential slowdown in the global economy.

The Nikkei 225 index rose 0.12 percent, or 23.98 points, to close at 20,649.14, but the broader Topix index was down 0.26 percent, or 3.98 points, at 1,506.81.

Tokyo stocks opened lower but recovered their early losses by the closing bell as investors welcomed a weak yen against the dollar, brokers said.

“There are many Japanese shares which are still undervalued,” said Shinichi Yamamoto, broker at Okasan Securities in Tokyo.

The dollar fell to 106.18 yen in Asian afternoon trade from 105.94 yen in New York.

But movement was limited by fears that the global economy may be slowing, after US data pointed to weakness in the manufacturing sector.

Wall Street stocks tumbled Tuesday as new tariffs in the US-China trade war took effect, while US data suggested weakness in the manufacturing sector.

Washington and Beijing imposed new levies on 1 September, with the US now leveling 15 percent tariffs on an assortment of consumer goods and China responding with its own duties.

Meanwhile, “against expectations for an unchanged outcome, the US ISM manufacturing index contracted in August clipping the wings of a rising US dollar, (and) also dragging equities,” Rodrigo Catril, senior strategist at National Australia Bank, said in a note.

The direct impact of Britain’s political confusion on the Japanese market appeared limited, Okasan’s Yamamoto said.

“But Japanese shares may be affected by US and European reactions to Britain’s decision on Brexit,” he said.

In Tokyo, Nintendo jumped 2.59 percent to 41,580 yen as Sony gained 0.85 percent to 6,150 yen.