Hong Kong leader Carrie Lam has announced the withdrawal of a controversial extradition bill that has plunged the city into its worst political crisis in decades.
Ms Lam made the announcement in a video message shown on live television.
"The government will formally withdraw the Bill in order to fully allay public demands", she said, in the most important concession demonstrators have won in months of constant unrest.
Hong Kong's benchmark Hang Seng Index jumped after earlier reports of the withdrawal, trading up about 3.3 per cent. The property index also jumped six per cent.
However, many protesters and critics were not fully satisfied. Addressing each of the protesters' five key demands in turn, Ms Lam gave little more ground.
The city's embattled chief executive refused to drop charges against protesters, saying "this is contrary to the rule of law".
On the subject of universal suffrage she said that discussions on the matter would have to wait until there is an "atmosphere that is conducive to mutual trust."
Closing the message, the 62-year-old promised to reach out to people from all walks of life for direct dialogue aimed at easing citizens' discontent.
Pro-democracy lawmaker Claudia Mo said that the extradition bill's withdrawal was "too little, too late."
Ms Mo warned that bowing to a single demand from the protesters could lead Hong Kong authorities to clamp down harder on those who refuse to now return to normal life.
"The young have been very adamant about the five demands," she said.
The withdrawal of the draft legislation was one of the protesters' key demands. Lam has said before that the bill was “dead” but she did not withdraw it.
Hong Kong returned to China under a “one country, two systems” formula that allows it to keep freedoms not enjoyed on the mainland, like the freedom to protest and an independent legal system, hence the anger at the extradition bill and perceived creeping influence by Beijing.
Lam told business leaders last week that she had caused “unforgivable havoc” by introducing the bill and that if she had a choice she would apologise and resign, according to a leaked audio recording.
At the closed-door meeting, Lam told the group that she now has “very limited” room to resolve the crisis because the unrest has become a national security and sovereignty issue for China amid rising tensions with the United States.
China has denounced the protests and warned about the impact on Hong Kong's economy and denies it is meddling in Hong Kong's affairs but warned again on Tuesday that it would not sit idly by if the unrest threatened Chinese security and sovereignty.
Riot police fired beanbag guns and used pepper spray - both anti-riot weapons - on Tuesday to clear demonstrators from outside the Mong Kok police station and in Prince Edward metro station, with one man taken out on a stretcher with an oxygen mask over his face, television footage showed.
Videos showing the man being apprehended by the police in the station have been widely shared on social media with protest groups and activists saying it is evidence of the police brutality they say is widespread and needs to be investigated.
Hong Kong police, who have repeatedly denied using excessive force, did not immediately respond to a request for comment.
Three men, aged between 21 and 42, were taken to Kwong Wa Hospital late on Tuesday, a hospital authority spokeswoman said.
Two, including the man stretchered out of Prince Edward station, were in a stable condition and one had been discharged, she said.