HK shares hit 4-mth lows as HSBC, HKEx skid

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(Updates to close)

By Rita Chang

HONG KONG, Jan 15 (Reuters) - Hong Kong blue chips slid to
their lowest close since September on Tuesday, their fourth
straight session of losses, as investors offloaded stocks across
the board before earnings reports by U.S. banks this week.

Bellwether and global bank HSBC Holdings plc (0005.HK) sank
to 27-month lows and Hong Kong Exchanges and Clearing Ltd (HKEx)
(0388.HK), a barometer of market sentiment, fell sharply for a
fourth straight trading day.

Shipping plays, particularly dry bulk shippers, suffered
large losses after the Baltic Dry Index .BADI, an indicator for
commodity-freight rates, marked a three-day losing streak.

"People are beginning to realise what we're dealing with is
structural and systemic," said Miles Remington, sales and trading
director at BNP Paribas.

"In the short-term, you'll be nervous. There's a lack of any
real concrete story on the buy side and people are looking at the
negative more than the (positive)."

Hong Kong opened on solid footing, then saw a brief spell of
panic selling before the midday break. The blue-chip Hang Seng
Index .HSI ended near the day's lows, closing down 2.4 percent,
or 630.35 points, at 25,837.78.

The China Enterprises index of H shares .HSCE, or Hong
Kong-listed shares in mainland companies, fell 3.1 percent, or
480.20 points, to 14,999.90.

Hong Kong's sustained weakness has pushed the premium
.HSCAHPI that mainland-traded shares command over their Hong
Kong counterparts to a record. Mainland-traded shares are now
valued, on average, twice as much as H shares.

Mainboard turnover was a heavy HK$121.1 billion (US$15.5
billion), up from Monday's HK$109.7 billion.

HSBC ended down 2.1 percent at HK$120.80. Goldman Sachs
placed the bank on its conviction sell list, according to a
research report released Tuesday.

HKEx tumbled a further 3.6 percent to HK$184.90.

Among shippers, Pacific Basin (2343.HK) buckled 6.7 percent
to HK$9.28 and China Shipping Development (1138.HK) dropped 6.7
percent to HK$21.55. Sinotrans Shipping (0368.HK) tumbled 4.3
percent to HK$5.15.

China Mobile (0941.HK), the day's most active stock, skidded
4.2 percent to HK$124.80. The country's top wireless operator and
Apple Inc (AAPL.O) have called off talks to launch the U.S.
firm's popular iPhones in China, dashing investor speculation
that the device will hit store shelves soon and knocking China
Mobile shares late on Monday. [ID:nHKG332477]

Other large-cap losers included China Railway (0390.HK), down
6.4 percent at HK$10.02, while cement engineering firm Sinoma
(1893.HK) dived 7 percent to HK$8.75.

PC maker Lenovo Group (0992.HK) notched up 1.4 percent to
HK$5.26, tracking gains in U.S.-traded peers after IBM (IBM.N)
posted better-than-expected preliminary quarterly earnings.

Esprit Holdings Ltd (0330.HK) reversed a six-session losing
streak to rise 1.7 percent to HK$92.45. A disclosure with the
Hong Kong Stock Exchange showed Capital Research Management
bought 2.37 million shares at HK$108.313 earlier in the month.

Comments by Hong Kong central bank chief Joseph Yam, who told
reporters on Tuesday he hoped for an early launch of a
much-anticipated scheme to allow individual mainland Chinese
investors to buy Hong Kong shares, had no impact on the market.

The announcement of that landmark plan had triggered a rally
in 2007's third quarter but market experts and sources said the
programme had since been stalled by government infighting and
fears it could hammer mainland Chinese stock markets.

"I certainly hope it will start soon. It is a very important
project -- a project that will facilitate the orderly outflow of
capital from the mainland of China. This is important for the
financial development of the mainland," Yam said on the sidelines
of a financial conference.
(US$1=HK$7.8)
(Editing by Anne Marie Roantree)