HK shares down, banks lead losses; China retreats

* HK shares end lower, led by banks, property issues

* BEA off high, Taifook soars on sale rumours

* China shares ease; consumer sector shines
(Updates to close)

By Donny Kwok and Claire Zhang

HONG KONG/SHANGHAI, Nov 12 (Reuters) - Hong Kong stocks fell
1.01 percent on Thursday, ending a four-day rally with banks and
property leading losses, while shares in China eased with
strength in consumer sector shares slowing the slide.

HSBC (0005.HK) fell 1.12 percent to HK$92.95 after rising 6.2
percent to a 13-month high in the previous session after it
announced the first improvement for three years in losses on U.S.
consumer credit. ICBC (1398.HK) fell 1.62 percent and China
Construction Bank (0939.HK) shed 1.13 percent.

Property shares declined, with Henderson Land (0012.HK) down
1.95 percent and Wharf (0004.HK) off 3.67 percent.

"It was good to see consolidation, allowing the market to
build up momentum to climb further," said Conita Hung, head of
equity research at Delta Asia Financial. "The underlying tone
remains positive, given the weak dollar and continuing inflow of
funds."

The benchmark Hang Seng Index .HSI fell 229.64 points to
22,397.57, while turnover decreased slightly to HK$70.95 billion
($9.2 billion) from Wednesday's HK$72.3 billion.

The China Enterprise Index .HSCE of top locally listed
mainland Chinese stocks fell 1.01 percent to 13,324.99.

Bank of East Asia (0023.HK) rose to a 16-month high of
HK$36.50, extending gains from the previous session on talk that
the bank could be a takeover target for Malaysian conglomerate
Guoco Group (0053.HK). The stock closed at HK$34.05, up 2.1
percent.

Guoco said its stake in the lender remained one of its
strategic investments. [ID:nHKG335795]

Financial services firm Taifook Securities (0665.HK) rose to
a 23-month high of HK$4.95 after NWS (0659.HK) said it was in
talks to sell part or all of its 61.86 percent stake, without
giving details. A local newspaper cited market rumours that China
Construction Bank (0939.HK) could be the buyer. Taifook ended at
HK$4.55, up 12.9 percent.

Bank of China (3988.HK) shares lost 2.3 percent to HK$4.68.
The Chinese bank aimed to more than double lending this year from
2008, the top executive of the country's biggest foreign exchange
lender said on Wednesday. [ID:nPEK343169]

Bucking a soft market, CITIC Pacific (0267.HK) rebounded 9.09
percent to HK$22.20 after Nomura International upgraded the group
to "buy" from "reduce" and raised its price target to HK$26.10
from HK$20.80 on an improved outlook and a potential mainland
listing.

Geely Auto (0175.HK) rose nearly 10 percent to an all-time
high of HK$3.55 after the Chinese automaker announced the
completion of a fundraising deal with Goldman Sachs (GS.N).

Galaxy Entertainment (0027.HK), one of six gambling licence
holders in Macau, fell 3.36 percent to HK$3.74. It raised the
estimated cost of its project on the Cotai Strip by 40 percent to
about HK$14.1 billion ($1.8 billion) as a result of design
changes, media said on Thursday. [ID:nHKG370202]

SHANGHAI SLIDES, CONSUMER STOCKS UP

China's key stock index eased 0.07 percent on Thursday, with
large caps weak as profit-taking moved in after a nearly
uninterrupted climb since late last month, but consumer sector
shares rose on expectations of solid earnings.

The Shanghai Composite Index .SSEC ended at 3,172.945
points, after snapping an eight-session rally on Wednesday when
it ended marginally weaker.

Gaining Shanghai A shares outnumbered losers by 494 to 370,
while turnover edged up to 152 billion yuan ($22.27 billion) from
Wednesday's 144 billion yuan.

Analysts said profit-taking loomed over the market after the
rally but sentiment remained strong, reflecting the upbeat
outlook for China's economy and corporate earnings.

"The index is likely to remain range-bound for a few more
days. The market still faces profit-taking pressure after an
almost non-stop gain," said Wu Nan, an analyst at Xiangcai
Securities in Shanghai. But he said positive factors outweighed
the negatives in the longer term.

Premier Wen Jiabao said on Thursday that China would stick to
its active fiscal policy and loose monetary measures even though
economic recovery was on more solid footing and after
weaker-than-expected new lending data for October on Wednesday.
[ID:nPEK374190]

"Although new lending is expected to remain weak,
expectations of yuan appreciation will encourage money to flow
into China," said Li Wenhui, a senior analyst at Huatai
Securities in Nanjing.

He said the index would be confined in coming days between
key psychological levels at 3,100 and 3,200 points.

China sent its clearest signal yet that it was ready to allow
yuan appreciation after an 18-month hiatus, saying late on
Wednesday that it would consider major currencies, not just the
dollar, in guiding the exchange rate. [ID:nSP466424]

The consumer sector was strong, with Tonghua Grape Wine
(600365.SS) and home appliance maker Hefei Meiling (000521.SZ) up
by their 10 percent daily limits.

Huatai Securities' Li said the consumer sector looked certain
to show a solid increase in fourth-quarter earnings.

The bank sector was soft, with Bank of Communications
(601328.SS) slipping 0.23 percent to 8.82 yuan.

China Minsheng Banking (600016.SS) rose 1 percent to 8.09
yuan. The official China Securities Journal reported that its
$4.07 billion Hong Kong initial public offering had attracted
several high-profile domestic and overseas bidders.

China Merchants Securities Co, which plans to raise up to
11.1 billion yuan through an initial public share offering in
Shanghai, said its IPO had been nearly 94 times subscribed, tying
up a massive 1.1 trillion yuan. [ID:nSHA372583]

Money from unsuccessful subscriptions would be unfrozen on
Thursday and Friday and some of that may flow back into the
market, analysts said.
(Editing by Chris Lewis)