HK shares to gain on U.S. mortgage news, lower oil

HONG KONG, July 14 (Reuters) - Hong Kong shares will trend higher on Monday, spurred on by the U.S government's decision to come to the rescue of its beleaguered mortgage lenders as crude oil prices came off highs. On Sunday, the Treasury and Federal Reserve unveiled sweeping steps to shore up the troubled mortgage financing giants Fannie Mae (FNM.N) and Freddie Mac (FRE.N) if need be, and head off a potential meltdown in global financial markets.

During Friday's roller-coaster session, the Dow dropped below the 11,000 level for the first time since July 2006 on worries over the fate of the credit market.

"The message investors take home from Sunday's move is that the U.S government will not let the credit market sink and that is a huge reassurance," said Francis Lun, general manager with Fulbright Securities.

Lun expects the Hang Seng Index on Monday to hit 22,500, a level last seen three weeks ago.

U.S. crude jumped to a record high of $147 a barrel on Friday and pulled gold to a four-month peak amid security concerns in the oil-rich Middle East, a weak dollar and a looming strike in Brazil's oil industry. But prices had eased to $143.35 per barrel in Asian trade on Monday.

Hong Kong shares climbed 1.7 percent on Friday, with the benchmark index closing above 22,000 for the first time this month, as investors cheered a report that the U.S. government was considering taking over the two beleaguered U.S. mortgage firms.

The Hang Seng Index .HSI rose 3.6 percent for the week.

STOCKS TO WATCH

* Sun Hung Kai Properties (0016.HK) said late last Friday it would team with Wharf Holdings (0004.HK) and Henderson Land (0012.HK) to contribute a total of 4.6 billion yuan ($673.1 million) to a joint venture firm for developing a piece of land in China's Chengdu. Sun Hung Kai will own 40 percent of the joint venture firm, while Wharf and Henderson will each hold 30 percent. For a full statement please see here

* Beijing North Star (0588.HK) said on Monday China Securities Regulatory Commission had approved its public issue of corporate debenture of not more than 1.7 billion yuan. For statement please read here

* PCCW (0008.HK) is under pressure from lenders to lift its proposed pricing target on a US$3 billion syndication loan, the largest ever in the city's financial history, the South China Morning Post said. Most lenders pitched at 170 to 180 basis points over Libor, while PCCW was willing to pay an all-in interest rate of about 150 basis points over Libor. * China Oilfield Services aims to use its takeover target Norway's Awilco Offshore AWO.OL to help achieve its goal of sourcing more than half of its revenue from overseas by 2020, the South china Morning Post quoted China Oilfield chief financial officer Zhong Hua as saying. The company derived 18.3 percent of its revenue from overseas contracts last year.

* Due to a slowdown in global trade and exports, container terminals operator China Merchants (Holdings) (0144.HK) has linked up with Baosteel, the South China Morning Post quoted China Merchants chairman Fu Yuning as saying.

As per the agreement between the two companies, Baosteel has taken an 8 percent stake in Zhanjiang Port, diluting China Merchant's holding to 40 percent while the rest is retained by the port authority. The partners have earmarked 4 billion yuan for port expansion. ---------------MARKET SNAP SHOT AT 23:22 GMT ------------------

INSTRUMENT LAST PCT CHG NET CHG S&P 500 .SPX 1,239.49 -1.11 -13.900 USD/JPY JPY= 106.38 0.27 0.290 10-YR US TSY YLD US10YT=RR 3.971 -- 0.000 SPOT GOLD XAU= $963.30 -0.04 -0.400 US CRUDE CLc1 $143.61 -1.01 -1.470 DOW JONES .DJI 11100.54 -1.14 -128.48 ASIA ADRS .BKAS 144.26 - 1.21 -1.76 -------------------------------------------------------------> SE Asian Stocks-Higher on Fannie, Freddie report [.SO] > Dollar up, bonds fall on US help for Fannie, Freddie [USD/] > Prices fall as GSEs bailout talks stir supply fears [US/] > Gold hits 4-month high on record oil, weak dollar [GOL/] > NYMEX crude falls over $2 as U.S. dollar recovers [O/R] > US STOCKS-Futures, dollar gain after Fed, Treasury statement[.N] (Reporting by Parvathy Ullatil; Editing by Anne Marie Roantree)