HK shares track global sell-off, but PetroChina up

(For Shanghai stock market reports, click [.SS])
(Adds Monday midday close, details)

By Rita Chang

HONG KONG, Oct 22 (Reuters) - Hong Kong blue chips fell 2.5
percent and China plays dropped 2.7 percent on Monday as sharp
declines in global equities prompted investors to book profits in
recent gainers such as oil refiner Sinopec Corp (0386.HK: Quote, Profile, Research).

But recent high flyer PetroChina Co Ltd (0857.HK: Quote, Profile, Research), the
country's top oil producer, had reversed earlier losses to move
into positive territory.

"The downside is narrowing," said Kingston Lin, associate
director at Prudential Brokerage.

"Money inflows into the market are still very strong.
Investors still want to be in the market."

Lin predicts the market would continue its rebound in the
afternoon to finish the session 500 points lower, compared with
its more than 1,000-point opening loss.

The benchmark Hang Seng Index .HSI had fallen 744.22 points
to 28,720.83 by midday. The China Enterprises Index of mainland
companies listed in Hong Kong .HSCE fell 540.40 points to
19,181.98.

Mainboard turnover was HK$91.6 billion (US$11.7 billion),
compared with Thursday morning's HK$101.4 billion.

PetroChina, the morning's most traded stock, was a rare
gainer, rising 1.4 percent to HK$19.18, supported by its domestic
listing plan.

Worries that the housing slump could drag down the wider U.S.
economy hit shares that have exposure to the subprime lending
sector. HSBC Holdings plc (0005.HK: Quote, Profile, Research) slid 2.6 percent to HK$146.7
and Bank of China (3988.HK: Quote, Profile, Research), which has the biggest subprime
exposure among the mainland lenders, skidded nearly 5 percent to
HK$4.51.

Mainland telecoms fell on talk that 3G licences may not be
issued before the 2008 summer Olympics in Beijing.

China Mobile (0941.HK: Quote, Profile, Research) fell 2.5 percent to HK$144.20 and
China Telecom (0728.HK: Quote, Profile, Research) dropped 2.4 percent to HK$6.64.

China Netcom (0906.HK: Quote, Profile, Research) tumbled 4.8 percent to HK$24.70 and
China Unicom (0762.HK: Quote, Profile, Research) slid 4.6 percent to HK$15.34.

Resource stocks, which were among the top recent
outperformers on the back of the weak U.S. dollar and high petro
prices, also suffered steep losses. Sinopec was off 3.8 percent
to HK$11.80.

Gold play Zijin Mining (2899.HK: Quote, Profile, Research) shed nearly 4 percent to
HK$12.84 and Jiangxi Copper (0358.HK: Quote, Profile, Research) tumbled 4.6 percent to
HK$29.35.

Coal producer China Shenhua (1088.HK: Quote, Profile, Research) sank 5 percent to
HK$48.70 and China Coal (1898.HK: Quote, Profile, Research) dropped close to 5 percent to
HK$26.05.
(US$1=HK$7.8)