* HSI -0.3 pct, H-shares -1.4 pct, CSI300 -0.6 pct
* PBOC raises tightening fears, banks, property slide
* HSI revision sinks Chalco, lifts Lenovo
* AIA climbs, investors rotate into earnings safety
By Clement Tan
Feb 7 (Reuters) - Shanghai shares saw an eight-day winning
streak end on Thursday, pulling down Hong Kong, as financial and
property stocks slid after China's central bank signalled it
would shift its focus back to tackling inflation from supporting
The official China Securities Journal reported that
first-tier cities may slow issuance of pre-sale permit in the
first half of 2013, which added to jitters after the People's
Bank of China flagged containing speculative housing demand as a
The Hang Seng Index ended down 0.4 percent to 23,177
points, keeping above Tuesday's one-month closing low at
23,148.5. The China Enterprises Index of the top Chinese
listings in Hong Kong shed 1.4 percent.
In the mainland, the Shanghai Composite Index fell
0.7 percent following its eight-day winning streak during which
it rose 6.2 percent. The CSI300 of the top Shanghai
and Shenzhen A-share listings shed 0.6 percent from Wednesday's
17-month closing high.
Shanghai's losses came in the third-lowest volume in 2013,
while Hong Kong turnover stayed lackluster although it sneaked
above its 20-day moving average for only the third day in almost
"There's some rotation trade going on now, especially among
those who got in early in the rally," said Hong Hao, the Hong
Kong-based chief strategist at Bank of Communication
In a turnaround from its previous focus of supporting
economic growth, the Chinese central bank said in its
fourth-quarter monetary policy report that the country needs to
pay special attention to consumer prices.
Hong said he believes "it's too early to start worrying
about inflation in the first quarter. If anything, the central
bank's statement shows demand is returning, although some form
of property cooling policy can be expected if prices keep
Chinese banks were among the top drags on benchmark indexes
in both onshore and offshore markets. China Minsheng Bank
tumbled 5.2 percent in Hong Kong and 6
percent in Shanghai.
Before Thursday, Minsheng shares in both markets had more
than doubled from early September as signs of a recovering
Chinese economy and low valuations spurred interest in the bank.
China Vanke, the country's largest property
developer by sales, slid 2.3 percent. The Chinese central bank's
commitment to contain speculative home demand followed the State
Council affirming late on Tuesday the gradual expansion of
property taxes to more cities
In Hong Kong, China Resources Land lost 3.2
percent to its lowest since late December, while Shimao
Properties plunged 6.6 percent in its worst daily loss
Shares of Aluminum Corporation of China (Chalco)
fell 2.8 percent in Hong Kong after the index manager said late
on Wednesday that Lenovo Group will take its place as
a Hang Seng Index component from March 4. Lenovo's shares jumped
The announcement was part of a quarterly review that also
saw Haitong Securities replace ZTE Corp as a
component on the China Enterprises Index. ZTE's shares in Hong
Kong slid 1.4 percent. Haitong shed 2.1 percent after private
equity firm PAG, a cornerstone IPO investor, sold a $150 million
ROTATION IN PROGRESS
In Hong Kong, investors rotated into counters that have
lagged the rally from lows late last year as the corporate
earnings reporting season will pick up after next week's Lunar
New Year holiday.
"We expect the rally to falter at some stage, similar to
what happened in late 2011 and early 2012, as we remain
skeptical of the quality of the recent economic rebound," David
Cui, Bank of America-Merrill Lynch's chief China equity
strategist said in a note dated Feb. 6. "We doubt that much
positive earnings revision will come through."
Cui said investors should take heavy positions in
healthcare, food and beverage, telecom and utilities going into
the second quarter and move away from materials, banks and
properties - sectors that have rallied from lows in late 2012.
Still, headwinds remain for the food and beverage sector
after shares of Ajisen Holdings and China Foods
dived 7 and 13.7 percent respectively after warning
about declining profits.
But sector giant Tingyi Holdings rose 2 percent in
Hong Kong. In the last 30 days, analysts have revised upwards
their earnings-per-shares estimates for Tingyi, but not the
other two food companies, according to Thomson Reuters StarMine.
Tingyi shares are up 4.6 percent this year after falling 8.7
percent in 2012 and are now trading at a 5 percent discount to
its forward 12-month earnings, according to StarMine.
Shares of Asian insurance giant AIA Group climbed
1 percent to their highest in about a month. Four of 17 analysts
raised their full year 2012 earnings-per-share estimate by an
average of about 25.7 percent in the last month, according to