September 6, 2018 / 7:31 AM / 13 days ago

China stocks fall as investors fear more tariffs

* Shanghai Composite index ends down 0.5 pct, CSI300 falls 1.1 pct

* Natural gas firms surge on policy support expectations

* Tariffs on $200 bln of Chinese goods could come into effect this week

SHANGHAI, Sept 6 (Reuters) - China stocks closed lower on Thursday as investors fretted about the possible imposition of new U.S. tariffs on imported goods from China, which could come as early as this week.

** A public consultation period on plans by Washington to impose tariffs on an additional $200 billion worth of Chinese imports ends on Thursday. A Bloomberg report said Trump plans to impose the tariffs after that deadline.

** However, U.S. President Donald Trump said on Wednesday that the United States was not yet ready to come to an agreement over trade disputes with China but added talks would continue.

** “We still see that a negotiated settlement would be the most likely outcome, but do not expect this to come soon,” analysts at Everbright Sun Hung Kai said in a note. “An agreement still seems unreachable as of yet, given the unwavering stances of both sides on key facets of the disagreements, which, for the US, may hinge on whether China makes greater concessions, as Trump reportedly told reports in his comments, more so than what China has done already.” ** At the close, the Shanghai Composite index ended 12.74 points, or 0.5 percent, lower at 2,704.34.

** The blue-chip CSI300 index ended down 1.07 percent, with its financial sector sub-index lower by 0.93 percent, the consumer staples sector down 2.56 percent, the real estate index down 2.22 percent and healthcare sub-index down 1.38 percent.

** Shares in Chinese natural gas firms closed higher as investors expect them to benefit from Beijing’s policies to support the sector. Chongqing Gas Group Co Ltd ended up 6.1 percent and Foshan Gas Group Co Ltd climbed 5.2 percent.

** China’s State Council said the government is considering extending subsidies for unconventional natural gas production, and will push the gasification drive in a measured manner in accordance with demand. ** The smaller Shenzhen index ended down 0.72 percent and the start-up board ChiNext Composite index was weaker by 0.51 percent. ** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1 percent, while Japan’s Nikkei index closed down 0.41 percent. ** At 07:14 GMT, the yuan was quoted at 6.8379 per U.S. dollar, 0.14 percent weaker than the previous close of 6.8281. ** A Reuters poll of more than 50 foreign exchange strategists found expectations that the yuan will gain 1 percent to 6.77 per dollar within a year. Some economists expect an escalation in the trade war would force China’s central bank to intervene more forcefully to support its currency.

** The largest percentage gainers in the main Shanghai Composite index were Besttone Holding Co Ltd, up 10.04 percent, followed by Ningxia Jiaze Renewables Corp Ltd , gaining 10.04 percent and BOMESC Offshore Engineering Co Ltd, up by 10.02 percent. ** The largest percentage losses in the Shanghai index were Nanjing Central Emporium Group Stocks Co Ltd down 10 percent, followed by Nantong Jiangshan Agrochemical & Chemicals Co Ltd losing 7.62 percent and Milkyway Chemical Supply Chain Service Co Ltd down by 7.5 percent. ** So far this year, the Shanghai stock index is down 18.6 percent, the CSI300 has fallen 19.1 percent while China’s H-share index listed in Hong Kong is down 10 percent. Shanghai stocks have declined 1.23 percent this month. ** About 9.90 billion shares were traded on the Shanghai exchange, roughly 79.8 percent of the market’s 30-day moving average of 12.41 billion shares a day. The volume in the previous trading session was 10.50 billion. ** As of 07:15 GMT, China’s A-shares were trading at a premium of 19.01 percent over the Hong Kong-listed H-shares. ** The Shanghai stock index is below its 50-day moving average and below its 200-day moving average. ** The price-to-earnings ratio of the Shanghai index was 11.38 as of the last full trading day, while the dividend yield was 2.7 percent. ** So far this week, the market capitalisation of the Shanghai stock index has fallen by 0.77 percent to 28.80 trillion yuan.

Reporting by Andrew Galbraith; Editing by Sunil Nair

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