(Updates to clsoe)
* HSI down 1 pct, Shanghai Comp down 1.7 pct
* Turnover slumps on both bourses
* Chinese oil majors weaker on lower oil prices
* Growth-sensitive sectors take a beating in Shanghai
By Clement Tan
HONG KONG, Jan 16 Shares in Hong Kong and
China fell on Monday, with the Shanghai index posting its
fourth-straight losing session, as investors took profits on
recent outperformers and awaited economic data from China that
could give clues on further policy easing.
The broader Hang Seng Index declined 1 percent, while
the China Enterprises Index of the top Chinese listings
in the territory fell 1.4 percent after surging 6.5 percent last
The Shanghai Composite Index lost 1.7 percent,
Turnover slipped 35 and 27 percent from Friday in Shanghai
and Hong Kong, respectively, and could stay low going into the
long Chinese New Year holiday next week, traders said.
China will release data on Tuesday that is expected to show
economic growth moderated further in the fourth quarter to an
annual 8.7 percent, according to a Reuters poll. Beijing will
also release December industrial output, investment and retail
"We are waiting for GDP for fresh direction. If it comes in
lower than expected, it's going to boost hopes of easing, but
any lift from that is likely to be short term," said Jackson
Wong, Tanrich Securities' vice-president of equity sales.
The Hang Seng Index finished near the bottom of a
narrow 85-point range on Monday, supported at 19,000 after being
failing to breach resistance levels of around 19,242 last week.
Its near down-side target is seen at about 18,858, the level
at which it closed on Jan. 9 before jumping last week.
PetroChina Co Ltd, which closed at the highest
since early August in Hong Kong on Friday, slipped 0.9 percent.
CNOOC Ltd declined 1.6 percent, while China Petroleum
& Chemical Corp (Sinopec) lost 2.5 percent.
Also weighing on resources stocks were lower commodities
prices, on fears that mass sovereign debt rating cuts by
Standard & Poor's could further aggravate euro zone funding
difficulties and further dampen global growth.
All three Chinese oil majors were key drivers of the Hang
Seng Index's strong start to the year, largely on the back of
rising oil prices from rising tensions on oil supply associated
with Iran sanctions.
Bucking the weaker sentiment on the day was Warren
Buffett-backed Chinese automaker BYD Co Ltd.
Its H-share listing rose for a sixth-straight session,
jumping 4.8 percent to the highest since Aug. 15 in volume more
than three times its 30-day average.
Investors were pouring back into the stock in anticipation
that it could benefit from a new policy supporting production of
environmentally-friendly cars, analysts said.
OUTPERFOMERS DIVE IN SHANGHAI, TURNOVER AT 2012 LOW
The Shanghai Composite Index closed at 2,206.2, a
touch below its 20-day moving average, after breaking below
chart support seen at around 2,241 points, its level on Dec. 14
before losses accelerated.
PetroChina and Sinopec were among
the top drags in Shanghai, slipping 1.1 percent apiece, but the
growth-sensitive materials sector was a standout underperformer,
with the Shanghai materials sub-index diving 3.6
Inner Mongolia Baotou Steel Rare Earth (Group) Hi-Tech Co
Ltd (Baotou Steel) slumped 8.4 percent in more than
twice its 30-day average volume, halving its gains from last
Kweichow Moutai Co Ltd lost 6 percent. It has
led a slew of top liquor brands that have been standout
outperformers in the last two years while the Shanghai Composite
has lost 33 percent.
A-share turnover in Shanghai was at its lowest in 2012 to
date, with a spike in China's short-term money market rate to a
six-month high suggesting money supply will remain tight heading
into the Lunar New Year next week.
Turnover on mainland Chinese bourses fell 23.4 percent in
2011 from 2010, while the number of companies listed rose 13.5
percent over the same period, data from the China Securities
Regulatory Commission (CSRC) showed on Monday.
Money supply has been crimped on the mainland partly due to
Beijing's tight monetary policy as it tries to rein in
inflation. This has in turn made it difficult for companies to
raise funds in the mainland, particularly small and medium-sized
On Monday, the China securities regulator told the Asian
Financial Forum in Hong Kong that there were plans to relax
controls on overseas listings for Chinese companies, while
pushing for an expansion of yuan-denominated shares in the
offshore yuan market in the territory.
(Additional reporting by Jason Subler in Shanghai; Editing by