China shares outshine Asia, lift Hong Kong, on encouraging data
* HSI +0.7 pct, H-shares +2.1 pct, CSI300 +3.5 pct
* Positive China inflation, trade data lifts A-share market
* Reported Shanghai trade zone perks lift shippers, banks
* PetroChina denies allegations of more probes, to resume trading
By Clement Tan
Sept 9 (Reuters) - China shares outperformed others in Asia early Monday, lifting Hong Kong markets, as August inflation and trade data added to optimism that growth has stopped slowing in the world's second-largest economy.
Shanghai-related counters again had solid gains after the official Shanghai Securities News reported on Monday that companies operating in the city's new free-trade zone may enjoy special tax exemptions.
At the midday trading break, the Hang Seng Index was up 0.7 percent at 22,787.3 points, its highest intra-day level since May 29. The China Enterprises Index of the top Chinese listings in Hong Kong climbed 2.1 percent.
The CSI300 of the leading Shanghai and Shenzhen A-share listings jumped 3.5 percent, while the Shanghai Composite Index spiked 3 percent. Both were at their highest intra-day levels since mid-June.
"Market sentiment has been turning more and more positive, with the A-share market strong. But there's still not a lot of fresh buying," said Jackson Wong, Tanrich Securities' vice-president for equity sales.
Chinese shipping shares were also supported by resurgent freight rates, with the Dry Baltic Index again hitting its highest since January 2012. Sinotrans Shipping jumped 3.4 percent to be up 20 percent this month in Hong Kong.
China Shipping Container Lines (CSCL) surged by the maximum 10 percent limit in Shanghai and 3.7 percent in Hong Kong. CSCL Shanghai shares have rebounded 40 percent from a trough on Aug. 23, one day after China's cabinet approved the establishment of a free trade zone in Shanghai.
Shanghai Pudong Development Bank and Shanghai-based Bank of Communications , China's fifth-largest lender, also surged by the maximum 10 percent limit in the mainland, leading gains in the Chinese banking sector.
There was market speculation that Pudong Bank plans to issue preferred shares to boost capital. A media relations representative at the bank told Reuters it was not aware of any approval for such a plan.
Ping An Bank also soared 10 percent to 12.13 yuan in Shenzhen after its parent, Ping An Insurance Group , said it will acquire up to 1.32 billion new shares in the bank at 11.17 yuan per share, raising its stake to 59 percent.
Financials were also boosted by official data that showed China's annual consumer inflation was 2.6 percent in August, in line with market expectation.
Producer prices fell 1.6 percent last month from a year earlier, compared with a fall of 2.3 percent in the previous month and slightly less than an expected fall of 1.8 percent.
This follows data on Sunday that showed China's exports rose 7.2 percent in August from a year earlier and imports rose 7 percent, producing a trade surplus of $28.6 billion for the month.
Beijing is due to release monthly data for industrial output, retail sales and urban investment on Tuesday. Money supply and loan growth data is also expected this week.
Shares of embattled Chinese oil giant PetroChina were suspended following local media reports that alleged more probes of its executives were under way. The company said the reports were inaccurate and that trading of its share will resume in the afternoon.
Vinda International Holdings Ltd surged nearly 36 percent after the company said on Monday that Svenska Cellulosa Aktiebolaget SCA (SCA) had offered HK$8.65 billion ($1.12 billion) for all shares it did not already own in the household consumer paper maker.
Hong Kong-listed NagaCorp Ltd became the second industry player to take a punt on a Russian entertainment zone, agreeing to invest $350 million to build a casino, hotel and exhibition venue. Its shares rose 4.7 percent.
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