August 13, 2019 / 4:38 AM / 6 months ago

China stocks falter as bank lending falls; Hong Kong drags

* SSEC falls 0.7%, CSI300 1% lower; HSI hits lowest since early Jan

* China’s July new loans fall more than analyst estimates

* Shenzhen Aiport rallies as nearby HK airport hit by protests

HONG KONG, Aug 13 (Reuters) - Shares in mainland China fell on Tuesday after data showed banks gave out fewer new loans than expected in July to support slowing economic growth, while escalating protests in Hong Kong dampened sentiment.

** At the midday break, the Shanghai Composite index was down 0.7% at 2,794.07, and the blue-chip CSI300 index was down almost 1%. ** CSI300’s financial sector sub-index was lower by 1.3%, the consumer staples sector was down 0.5%, the real estate index was down 1.2% and the healthcare sub-index was down 0.4%. ** The smaller Shenzhen index was down 0.9% and the start-up board ChiNext Composite index was weaker by 1.2%. ** Chinese banks extended 1.06 trillion yuan ($150.06 billion) in new yuan loans in July, down from June and falling short of analysts’ expectations, according to data released by the People’s Bank of China on Monday. ** The PBOC lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit. ** China’s foreign exchange regulator said on Monday it does not expect disorderly depreciation of the yuan despite the impact from external factors such as trade frictions. ** The yuan was quoted at 7.0636 per U.S. dollar, 0.07% weaker than the previous close of 7.0585. ** Hong Kong leader Carrie Lam said on Tuesday the city’s recovery from protests that have swept the Asian financial hub could take a long time and that she would be responsible for rebuilding its economy “after the violence eases”. ** Protesters sat in at the Hong Kong airport on Monday, forcing mass flight cancellations in the afternoon. Also on Monday, Beijing condemened violence in the protests which it said had begun to show “sprouts of terrorism”. ** The Hang Seng Index dropped 1.9% in morning trade to 25,345.65, its lowest since early January, while Chinese H-shares listed in Hong Kong fell 1.4%. ** Shares in Shenzhen Airport Co Ltd surged over 10% to their highest since April 4. The company could benefit from losses in passenger flow in the nearby Hong Kong airport, Citic Securities’ analysts noted in report. ** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.1%, while Japan’s Nikkei index was down 1.1%. ** China’s A-shares were trading at a premium of 31.82% 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.

Reporting by Noah Sin; Editing by Rashmi Aich

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