HK shares seen dropping on lower oil, US data

HONG KONG, June 4 (Reuters) - Hong Kong shares are seen dropping on Thursday with lower oil prices and disappointing economic data from the U.S. providing investors with an opportunity to cash in some of their recent sharp gains.

"The U.S. dollar has been strengthening, reflecting a lower risk appetite among investors. We have to wait and see if funds are going to start flowing out of dollar-backed assets now," said Ben Kwong, chief operating officer with KGI Asia.

Oil fell more than 3 percent on Wednesday and hovered around $66 per barrel in Asian trade Thursday, dragged down by an unexpected build up in U.S. crude stockpiles and a stronger dollar.

China Railway Group (601390.SS)(0390.HK) will be in focus after the country's largest railway and highway builder, said it had won five railway construction contracts worth 10.1 billion yuan ($1.48 billion).

The railway builder late on Wednesday said the value of the contracts represented about 4.31 percent of its revenue in 2008, according to Chinese accounting standards. In April, company President Li Changjin estimated revenue would rise by nearly a quarter to 280 billion yuan this year, from about 225 billion yuan in 2008.

The benchmark Hang Seng Index .HSI rose 1 percent on Wednesday after upbeat U.S. housing sales data drummed up hopes for an economic recovery.

STOCKS TO WATCH-

* HSBC (HSBA.L) (0005.HK) fell sharply in early trade in London on Wednesday as traders cited market talk of Saudi conglomerate Saad Group [SAADG.UL] selling down its stake in Europe's biggest bank.

A Saad spokesman declined to comment. HSBC also declined to comment. But a Saad executive told Reuters the Saudi company was not planning to sell shares in Europe's biggest lender. The HSBC shed 1.8 percent in late trade in Hong Kong on Wednesday, while its London stock ended 1 percent lower, recovering after dropping close to 4 percent intraday.

* Property developer Hopson Development (0754.HK) on Thursday said it would sell HK$1.596 billion (US$204.6 million) worth of new shares to third-party investors, raising capital for general working capital.

Hopson said it would sell 120 million shares, or 7.54 percent of its enlarged share capital, at HK$13.30 per share. The issue price represents 8.02 percent discount to the closing price of HK$14.46 on Wednesday.

* Container terminal operator Dalian Port (2880.HK) on Thursday said it had completed the issue of second tranche of 1 billion yuan five-year medium-term notes with an interest rate of 4.28 percent. Proceeds will be used for working capital, to meet investment requirments and to repay existing bank loans.

* Manulife Financial Corporation (0945.HK) on Thursday said it had completed its $350 million offering of 14 million Non-cumulative Rate Reset Class 1 shares at $25 per share.

* Guangzhou Investment (0123.HK) said it had bought two property sites for commercial and residential use in Jiangmen City, Guangdong province, for a total of 968 million yuan.

* China Southern Airlines (1055.HK) said the China Securities Regulatory Commission had approved its plan to issue up to 721.15 million H shares to Nan Lung.

* Hong Kong Exchanges and Clearing (0388.HK) announced the appointment of JP Morgan's China chairman Charles Li as chief executive of the exchange with effect from Jan. 16, 2010, replacing Paul Chow who is retiring.

* Chongqing Iron & Steel (1053.HK) said it had appointed Dong Lin, who is currently chairman of Chongqing Iron & Steel Co (Group), as chairman with effect from June 1.

* Semiconductor maker China Resources Microelectronics (0597.HK) said its plan to take the company private had not been approved by minority shareholders and listing of the company's shares would be maintained. ----------------------MARKET SNAPSHOT @ 2241 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG S&P 500 .SPX 931.76 -1.37% -12.980 USD/JPY JPY= 95.91 0.01% 0.010 10-YR US TSY YLD US10YT=RR 3.4495 -- 0.000 SPOT GOLD XAU= 963.15 0.10% 1.000 US CRUDE CLc1 66.15 0.05% 0.030 DOW JONES .DJI 8675.28 -0.75% -65.59 ASIA ADRS .BKAS 110.87 -2.74% -3.12 -------------------------------------------------------------

MARKETS SUMMARY *Wall St dives on falling oil, recovery worry [nN03129712] *Oil drops 3 pct on US inventory rise, dollar gains [nSP477138] *Dollar rallies vs euro; data prompts profit-taking [nN03586889] *Treasuries gain as weaker stocks, data boost bids [nN0377710] (Reporting by Parvathy Ullatil; Editing by Chris Lewis)