UPDATE 1-PRESS DIGEST - China - May 4

(Adds items)

BEIJING/SHANGHAI, May 4 (Reuters) - Chinese newspapers available in Beijing and Shanghai carried the following stories on Monday. Reuters has not checked the stories and does not vouch for their accuracy.

CHINA SECURITIES JOURNAL

-- China's National Association of Financial Market Institutional Investors expects that government bond issuance in the second quarter will expand to 500 billion to 550 billion yuan ($73-81 billion), from 104.9 billion yuan during the first three months of this year.

-- China Galaxy Financial Holdings Co said its businesses were operating normally, unaffected by a government investigation of its former president.

SHANGHAI SECURITIES NEWS

-- China Pacific Insurance Group Co (601601.SS), the country's third-biggest life insurer, plans to spend nearly 500 million yuan increasing its stake in Changjiang Pension Insurance Co to 51.75 percent from 12.27 percent, becoming the biggest shareholder.

CHINA BUSINESS NEWS

-- Volkswagen (VOWG.DE) plans to cooperate with China's BYD Co Ltd (1211.HK) in developing batteries for cars.

FINANCIAL NEWS

-- China's yuan is set to become an international currency, and China's domestic asset prices can benifit, Jiming Ha, a senior economist with China International Capital Corp, said.

CHINA DAILY (www.chinadaily.com.cn)

-- China's economic slowdown has not hit wedding expenses as people rush to get married in 2009 -- a lucky year for most Chinese.

PEOPLE'S DAILY

-- Northeastern China's province of Liaoning has detected a new iron mine with estimated reserves of 2 billion tons.

-- The water flow in China's Yellow River in 2009 is likely to be 30 percent down from last year.