HK shares slide 4.5 pct on heightened econ fears

(Updates to mid morning)

By Parvathy Ullatil

HONG KONG, Oct 23 (Reuters) - Hong Kong shares slid 4.5 percent on Thursday, with the main index falling below 14,000 for the first time since mid-2005, tracking a global equities sell-off on heightened fears of a worldwide recession.

Slackening corporate bottomlines and trading losses related to currency hedging were in focus after a string of dismal quarterly earnings and forex loss warnings this week.

But China Overseas Land (0688.HK) dodged the downdraft, advancing 2.1 percent after the government announced measures on Wednesday to boost flagging property prices on the mainland.

At 0250 GMT the benchmark Hang Seng Index .HSI was 625.33 points lower at 13,630.67. The index shed nearly 7 percent in the previous two sessions.

HSBC Holdings (0005.HK), Europe's largest bank and the most heavily weighted stock on local blue-chip index, slid 3.5 percent to HK$100.2. The stock fell below HK$100 for the first time in more than 5 years earlier in the day.

"Investors are very concerned about a global economic slowdown, lower corporate earnings and rising signs of problems in the emerging markets," said Alex Tang, research director with Core Pacific-Yamaichi International.

"Even a benchmark stock like HSBC will not be able to hold above any of its previous support levels as the market sentiment remains extremely weak."

But HSBC has still outperformed the broad market, falling 24 percent since the start of the year compared with a more than 50 percent plunge on the Hang Seng Index.

The China Enterprises Index .HSCE of top locally listed mainland Chinese companies was down 6.4 percent at 6,271.71.

Shares of China Railway Group (0390.HK) plunged 9.1 percent after the biggest railway and construction builder on the mainland disclosed 1.9 billion yuan ($278 million) in foreign exchange losses for the first nine months of 2008. [ID:nHKG26975] The stock shed more than 20 percent of its market value on Wednesday on speculation of the forex losses.

China Railway Construction Corp (1186.HK) fell 11.1 percent at the open after it reported a 320 million yuan foreign exchange loss for the third quarter. It scaled back losses to 0.9 percent by mid-morning after analysts said the market had overreacted. The shares were down about 19 percent on Wednesday.

But CITIC Pacific advanced 11.4 percent after its two-day, 66 percent nosedive triggered bargain buying in the stock. The Beijing-backed conglomerate revealed a likely $2 billion foreign exchange trading loss on Monday.

Aluminum Corp of China (2600.HK), the third largest alumina producer in the world, dropped 8.2 percent after it said it was aiming to cut production by 18 percent annually amid plummeting prices of the metal. (Reporting by Parvathy Ullatil; Editing by Anne Marie Roantree)