Hong Kong shares set for weekly loss, China oil majors slump

(Updates to midday)

* HSI down 1 pct, HSCE sheds 1.3 pct

* Mainland Chinese markets closed for holiday

* PetroChina, CNOOC track plunge in global oil prices

* Evergrande recovers, company mulls legal action

By Clement Tan and Vikram Subhedar

June 22 (Reuters) - Hong Kong shares slipped for a second-straight session on Friday, poised to end this week in the red with Chinese oil majors suffering the brunt of renewed growth fears after global manufacturing data disappointed.

Business activity across the euro zone shrank for a fifth straight month in June and Chinese manufacturing contracted, while weaker overseas demand slowed U.S. factory growth, surveys showed on Thursday.

Consumer goods exporter Li & Fung, whose global distribution and trading centres make it a barometer of consumer sentiment, slumped 4.2 percent to its lowest since June 8.

The Hang Seng Index was down 1 percent at 19,067.5 by the midday break. It is down 0.9 percent for the week. Near-term support is seen at the 50 percent Fibonacci retracement of its rise from October lows to February highs at about 18,968.6.

The China Enterprises Index of the top Chinese listings in Hong Kong shed 1.3 percent and is down 2.1 percent on the week. Mainland Chinese markets are closed for a public holiday.

"If you give me $1 million, I won't put more than half of that into the market right now and even what I do put in will be for the short term," said Larry Jiang, chief strategist at Guotai Junan International Securities in Hong Kong.

"Valuations are supportive but people are just not willing to pay a higher multiple to own stocks. The U.S. is clearly not in as good a shape as people thought even a month ago. We still don't know if China has found a bottom and there's Europe," he added.

The Hang Seng Index is currently trading at 9.1 times forward 12-month earnings, the lowest since September 2011 and 12 percent below the year's high at 10.4 times seen in March.

Chinese oil majors extended losses, tracking the downward spiral in global oil prices that took Brent crude oil below $90 a barrel for the first time in 18 months on Thursday.

Shares of CNOOC Ltd slumped 3.2 percent and shaving $2.8 billion off its market cap, while PetroChina Ltd shed 2.7 percent to cut $6.9 billion off its market cap. This week to date, they are down 4.6 and 3.2 percent, respectively.

EVERGRANDE RECOVERS

Chinese developer Evergrande rose 2 percent in strong volume, recovering from the 11 percent slump on Thursday after a short seller alleged China's second-largest developer by sales was insolvent in a research report.

Evergrande said it was considering legal action against Citron Research, which accused the company of financial irregularity and bribery.

Evergrande's chief executive officer also told investors in a call organised by Credit Suisse on Friday that the company was considering buying back shares, according to a source who participated in the call.

Lenovo Group Ltd, the world's second-largest PC maker, was flat at midday after the company said it had offered no new guidance on its growth predictions, a day after a Taiwan newspaper report that it had halved its growth forecasts sent its share price tumbling. (Editing by Jacqueline Wong)