China shares lifted by aviation firms, Hong Kong benchmark flat

Wed Aug 27, 2014 1:17am EDT

* HSI flat, H-shares +0.5 pct, CSI300 +0.4 pct

* China aviation, aerospace firms jump on aircraft progress

* China Oilfield hits 7-month high helped by earnings

* China Resources Power slips after president investigated (Updates to midday)

By Grace Li

HONG KONG, Aug 27 (Reuters) - China shares eked out slim gains on Wednesday morning, thanks to stronger aviation and aerospace sectors that gained on strides made in manufacturing the country's first large aircraft.

Hong Kong's main share index barely changed, but the gauge for H-shares outperformed underpinned by strength in the shares of China Oilfield Services due to strong earnings.

By midday, the Hang Seng Index was flat at 25,067.18 points. The China Enterprises Index of the top Chinese listings in Hong Kong rose 0.5 percent.

The CSI300 of the leading Shanghai and Shenzhen A-share listings added 0.4 percent, while the Shanghai Composite Index edged up 0.2 percent at 2,212.12 points.

"The market is still in a consolidation, weighed down by recent soft economic data and the coming subscriptions for initial public offerings," said Zhang Yanbin, an analyst from Zheshang Securities in Shanghai.

Among top index boosts in Shanghai, XiAn Aero-Engine PLC jumped the maximum allowed 10 percent and China Avic Electronics 2.4 percent.

The manufacturing of China's first large commercial passenger jet, the C919, is to enter the final assembly stage, the 21st Century Business Herald reported late on Monday. Jiangxi Hongdu Aviation Industry, maker of the aircraft's forebody, climbed 5.2 percent.

The biggest drag, Agricultural Bank of China, fell 0.4 percent. On Tuesday, the country's third-largest bank by assets became the third major Chinese bank to report slowing profit growth and rising bad loans for the second quarter, as a slowing economy hurts lenders.

China Oilfield Services leapt 8.2 percent in Hong Kong, hitting a 7-month high, and climbing 4.5 percent in Shanghai. The company posted a 39 percent rise in first-half profit late on Tuesday.

China Resources Power inched down 0.2 percent, trimming earlier losses of 3.6 percent, after the company said in a statement to the stock exchange its president Wang Yujun was under investigation.

Henderson Land Development gained 2.3 percent to a 6-1/2-year high, leading gains on the Hang Seng. The Hong Kong property developer said late on Tuesday its net profit in the first half increased by 22 percent. (Editing by Jacqueline Wong)

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