HK stocks open down 0.5 pct; China Eastern Air soars

HONG KONG, July 13 (Reuters) - Hong Kong shares are will open 0.5 percent lower on Monday, as investors continue to take profit ahead of interim corporate earnings announcements.

China Eastern Airlines (0670.HK) is set to soar after the money-losing air carrier said it would merge with Shanghai Airlines (600591.SS) in a share swap, and issue A shares and H shares worth about 7 billion yuan ($1.03 billion) to replenish its working capital.[ID:nSHA356254]

The stock, which resumed trade on Monday after being suspended since last month, will open 12.6 percent higher at HK$1.96.

The benchmark Hang Seng Index .HSI will start 95.97 points lower at 17,612.45.

The China Enterprises Index .HSCE, which represents top locally listed mainland Chinese stocks, will open 0.6 percent lower at 10,513.64. (Reporting by Parvathy Ullatil; Editing by Chris Lewis)