* HSI down 0.8 percent, HSCE down 1.2 percent
* CSI300 down 1.1, Shanghai Comp off 1.2 pct
* Prada weak, Esprit slumps as retailers on backfoot
* BYD shares in HK dive 10 pct on CLSA report
* HKEx down 2.3 pct, erases all gains post-QE3 (updates to close)
By Vikram Subhedar
HONG KONG, Sept 26 (Reuters) - Hong Kong shares fell on Wednesday, with consumer stocks the latest to be hit by profit-taking ahead of the quarter-end and as weak overseas markets and festering eurozone concerns kept investors wary of chasing this month's rally.
The Hang Seng index fell 0.8 percent to 20,527.7 points, with retailers bearing the brunt of pain. Esprit Holdings, which reported weaker-than expected annual results, ended the day down 6.9 percent.
Profit margins in China and Hong Kong are expected to remain under pressure through the rest of the year, with a mild recovery expected only next year, according to Credit Suisse.
"Any way we slice it, growth trends are sliding," said Credit Suisse analyst Karim Salamatian, the Hong Kong-based regional head of Credit Suisse's consumer research team.
The Hang Seng index is up 5.3 percent so far this month following aggressive policy easing by major central banks around the world as they look to boost growth.
But investors' are now turning their focus back to weak global demand.
In China, where the central bank has resisted taking more decisive steps such as cutting interest rates or banks' reserve requirements, stock indices fell to their lowest levels since the first quarter of 2009.
The CSI300 of the top Shanghai and Shenzhen listings fell 1.1 percent while the Shanghai Composite closed 1.2 percent.
Both Hong Kong and China markets got off on a weak start after the S&P 500 suffered its worst day since June.
Key to the declines were comments by Philadelphia Federal Reserve President Charles Plosser that questioned quantitative easing as a policy to counter sluggish economic growth and stubbornly low unemployment.
Protests in debt-laden Spain ahead of the planned announcement of a new round of austerity measures also kept investors away from riskier assets.
In Hong Kong, consumer-related stocks fell on relatively healthy volumes on an otherwise lacklustre day for trading.
High-end brands, jewelers and apparel makers were all weak as investors continued to take money off the table after the strong run-up in stocks this month.
Prada SpA fell 1.7 percent while consumer goods exporter Li & Fung fell a 2.3 percent, extending this week's losses to 4.1 percent.
Hong Kong jewellers, a sector favoured by the brokerage partly due to low valuations, also fell on Wednesday with Chow Tai Fook Jewellery Group down 1.8 percent and rival Luk Fook Holdings off 0.6 percent.
A pullback in gold prices this week continued to weigh on mining companies with Zijin Mining off 2.8 percent in Shanghai and down 2.6 percent in Hong Kong.
BYD SLUMPS, HKEx ERASES POST-QE3 GAINS
Shares of Warren Buffett-backed BYD Co Ltd slumped nearly 10 percent in Hong Kong trading after brokerage CLSA slashed its target price for the electric car maker.
In its report, CLSA maintained its "conviction sell" rating on the company and cut its target price on the stock to HK$0.41, suggesting a further 96 percent decline from current levels.
BYD shares traded nearly four-and-a-half times their average daily volume in Hong Kong. The company's Shenzhen listing fell 5.4 percent.
The drop off in overall market volumes continued to plague shares of Hong Kong Exchanges & Clearing, which fell 2.3 percent and have now erased all gains following the launch of latest round of asset purchases by the U.S. Fed on Sept 13.
Bucking the overall weaker trend, Hong Kong property stocks stood out posting gains on good volumes.
New World Development rose 3.5 percent after reporting strong earning earlier in the day. Henderson Land gained 2.3 percent. (Editing by Kim Coghill) (email@example.com; +852 28436975)