HK stocks likely to track soft overseas markets

HONG KONG, March 31 (Reuters) - Hong Kong stocks are expected
to fall on Monday, tracking soft overseas markets, but airline
shares may rebound from recent lows after oil prices dropped.

Investors will also focus on shares of Chinese solar wafer
maker Solargiga Energy Holdings Ltd (0757.HK: Quote, Profile, Research, Stock Buzz), which will make
its market debut after it scrapped a planed Hong Kong initial
public offering in January.

"Some 300 points downside is expected and a correction is
reasonable after four straight days of gains of more than 2,000
points," said Andrew To, a sales director at Tai Fook Securities.

"But the index may bounce back a hundred points as investors
look for bargains."

The benchmark Hang Seng Index .HSI closed 2.74 percent
higher at 23,285.95 points on Friday. The China Enterprises Index
of Hong Kong-listed mainland companies .HSCE, or H shares,
finished up 5.10 percent at 12,432.53.

"Too much upside is unlikely as investors are still uncertain
about the outlook for the U.S. markets," said Francis Lun, a
general manager at Fulbright Securities.

He added that China Resources (0291.HK: Quote, Profile, Research, Stock Buzz) may gain ahead of its
earnings due later the day.

Airline stocks, including Air China (0753.HK: Quote, Profile, Research, Stock Buzz), China Eastern
(0670.HK: Quote, Profile, Research, Stock Buzz), China Southern (1055.HK: Quote, Profile, Research, Stock Buzz) and Cathay Pacific (0293.HK: Quote, Profile, Research, Stock Buzz),
may rebound on weaker oil prices, brokers said.

STOCKS TO WATCH:

* CNOOC, parent of CNOOC Ltd (0883.HK: Quote, Profile, Research, Stock Buzz), is zeroing in on five
local refineries in eastern China for possible acquisitions as
the offshore oil and gas specialist pushes ahead with its
downstream expansion plans, a Chinese newspaper reported.
[ID:nPEK24372]

* China Communications Services Corp Ltd (0552.HK: Quote, Profile, Research, Stock Buzz) and a
stakeholder, the National Social Security Fund, were selling up
to $249 million worth of shares on Friday, according to a term
sheet obtained by Reuters.

* Dongfang Electric Corp (1072.HK: Quote, Profile, Research, Stock Buzz) said it would seek
shareholders' approval at a meeting in May to issue up to 65
million additional A shares, raising capital to fund part of its
3.96 billion yuan investment in wind power industrialisation
projects in China, a nuclear power technological renovation
project and a manufacturing base for clean and high-efficiency
generating equipment. For details please see
here

* Jiangsu Expressway Co Ltd (0177.HK: Quote, Profile, Research, Stock Buzz) said its profit
attributable to equity shareholders amounted to 1.64 billion yuan
for 2007 in accordnace with Hong Kong financial reporting
standards. For details please see
here

* Tsingtao Brewery (0168.HK: Quote, Profile, Research, Stock Buzz) said China Securities Regulatory
Commission had approved the company's plan to issue bonds with
warrants. For details please read
here

FACTORS TO WATCH:
* Japan's Nikkei falls, caution prevails before dataq [.T]
* Wall St drops on JC Penny's warning, bank worries [.N]
* STOCKS NEWS ASIA-Market factors, main events [STXNEWS/ASIA]
* Oil falls after Iraqi restores pipeline flows [O/R]
* Sagging U.S. Stocks drag dollar lower versus yen [USD/]
* For upcoming Hong Kong events, click on [HK/DIARY]
* For Hong Kong press digest, click on [PRESS/HK]

KEY HK ADR MOVERS (by % change)

China Petroleum (SNP.N: Quote, Profile, Research, Stock Buzz)(0386.HK: Quote, Profile, Research, Stock Buzz) +6.01

PetroChina (PTR.N: Quote, Profile, Research, Stock Buzz)(0857.HK: Quote, Profile, Research, Stock Buzz) +5.18

Yanzhou (YZC.N: Quote, Profile, Research, Stock Buzz)(1171.HK: Quote, Profile, Research, Stock Buzz) +5.16

CNOOC Ltd (CEO.N: Quote, Profile, Research, Stock Buzz)(0883.HK: Quote, Profile, Research, Stock Buzz) +4.49

Aluminum China (ACH.N: Quote, Profile, Research, Stock Buzz)(2600.HK: Quote, Profile, Research, Stock Buzz) +3.79

China Southern Air (ZNH.N: Quote, Profile, Research, Stock Buzz)(1055.HK: Quote, Profile, Research, Stock Buzz) +3.27
(Reporting by Donny Kwok; Editing by Anne Marie Roantree)