(Updates to close)
* HSI down 1.2 pct as weak China factory data weighs
* H-shares -1.4 pct, CSI300 -2.2 pct, Shanghai Comp -2.1 pct
* Sliding oil prices hit Chinese oil majors, lift airliners
* China Unicom hit by underwhelming new subscriber additions
By Clement Tan
HONG KONG, Sept 20 (Reuters) - Mainland Chinese shares sank
to their lowest levels since early 2009 on Thursday, pinning
Hong Kong markets back, after a survey showed the rate of the
slowdown in China's manufacturing activity was stabilising,
dousing hopes for imminent policy easing.
The HSBC Flash China manufacturing purchasing managers'
index indicated an 11th month of contraction, but ticked up to
47.8 from a nine-month low of 47.6 in August, while pointing to
a broad steadying across most sub-indexes.
However, there was little cause for premature cheer as the
sub-index covering output fell to 47.0, its lowest since
Still it was enough to douse hopes that Beijing would follow
the Bank of Japan, the European Central Bank and the U.S.
Federal Reserve in easing monetary policy in the near term.
"Data would probably need to be much worse than this for
Beijing to cut interest rates or reserve requirements for banks
with the 18th National Party Congress round the corner," said
Alan Lam, Julius Baer's Greater China equity analyst.
The People's Bank of China utilised its 28-day reverse repo
on Thursday only for the third time to inject $25.4 billion into
onshore money markets, in a further sign that the central bank
is holding off on further cuts in banks' reserve requirements.
The CSI300 Index of the top Shanghai and Shenzhen
listings shed 2.2 percent to 2,196 points, its lowest close
since March 2009. The losses took the CSI300 below chart support
at about 2,199.9, which had served as strong support in late
The Shanghai Composite Index dived 2.1 percent in
bourse volume that climbed almost 30 percent from Wednesday.
Both mainland indices have now dived more than 5 percent
from Sept 10 high, completely reversing gains from a
stimulus-led rally after Chinese media reported a raft of
infrastructure project approvals on Sept. 6 and 7.
The Hang Seng Index and the China Enterprises Index
of the top Chinese listings shed 1.2 and 1.4 percent
respectively, but held onto the gains from the Chinese stimulus
and the Fed's third round of quantitative easing, ending
Thursday at around last Friday's levels.
Hong Kong turnover sank more than 17 percent from Wednesday.
Chinese energy majors were major drags on indices in both
markets as global oil prices skidded. CNOOC Ltd
slumped 3.5 percent to its lowest this week.
Airlines conversely rose on the prospect of lower fuel
prices. In Hong Kong, Cathay Pacific gained 0.8
percent, while Air China rose 1.1 percent.
CHINA PLAYS IN FOCUS
The weak A-share market hit Chinese brokerages and insurance
companies, seen as proxies for onshore Chinese markets because
of their large investment and involvement. The CSI300 Index is
now down 5.2 percent this week, set for its fifth weekly loss in
Haitong Securities shed 2.3 percent in
Shanghai and 3.2 percent in Hong Kong. Citic Securities
fell 1.2 percent in Shanghai and 2.5
percent in Hong Kong.
China Life Insurance slid 1.5 percent
in Hong Kong and 2 percent in Shanghai, Ping An Insurance
declined 1.5 percent in Hong Kong and 1.4
percent in Shanghai.
China Unicom, the second-largest mobile operator
in the mainland, slumped 5.2 percent in Hong Kong to a two-week
low after the company posted underwhelming new August subscriber
(Editing by Kim Coghill)
(email@example.com; +852 2843-6392; Reuters