* HSI +0.1 pct, H-shares -0.1 pct, CSI -0.2 pct
* Strength in telcos, weak turnover point to risk aversion
* Issue at Huaxia Bank weighs on China finance sector
* Macau gaming sector slides after in-line revenue data
By Clement Tan
HONG KONG, Dec 4 Mainland Chinese shares
lingered at their lowest in nearly four years on Tuesday,
crimping Hong Kong gains, as investors were cool to China's
financial sector as one listed bank faced a problem involving
wealth management products.
Strength in Chinese telcos further pointed to risk aversion,
aggravated by weak U.S. manufacturing data, pushing down Hong
Kong midday turnover and Shanghai volumes to their lowest levels
in four sessions.
The Hang Seng Index went into the midday trading
break up 0.1 percent at 21,780.8. The index, up 18.1 percent
this year, on Monday failed to scale chart resistance at about
22,000 for the second time in a month.
The China Enterprises Index of the top Chinese
listings in Hong Kong slipped 0.1 percent. The CSI300
of the top Shanghai and Shenzhen listings was down 0.2 percent,
while the Shanghai Composite Index shed 0.4 percent.
The H-share index is now up 5.1 percent on the year, while
the CSI300 and Shanghai Composite are down 10.2 and 11.3 percent
respectively, and on track for a third-straight year of
Shanghai-listed Huaxia Bank, which fell 4.2
percent on Monday following media reports of a problem with a
wealth management product, slipped another 0.2 percent on
The bank has blamed a weekend panic on a rogue employee who
it said sold a high-risk investment vehicle without
authorisation, a case highlighting the risks tied to the
country's boom in loosely regulated wealth management products.
"The wealth management issue with Huaxia Bank is just a
measure of how big the problem can be," Hong Hao, Bank of
Communications International Securities' chief China strategist,
"It was the baijiu (white spirits) sector and now it's the
banks. Funds mandated to liquidate positions to cut losses will
add to losses. It's a vicious cycle at the moment," Hong added.
On Tuesday, the Chinese banking sector was again weak.
Industrial and Commercial Bank of China
slipped 0.3 percent in Shanghai and 0.8 percent to its lowest in
two weeks in Hong Kong.
Investors took profits on the Macau gaming sector after
revenue data late on Monday came in largely in line with
expectations. Sands China fell 3.5 percent after
rising almost 10 percent in the previous three weeks.
Weak U.S. data raised doubts about the economic health in
one of China's top export markets, and in turn, the
sustainability of its slow recovery. China consumer and energy
counters were also weak.
In Hong Kong, China-focused shoe retailer Belle
International was down 2.7 percent, while China
Shenhua Energy Co Ltd lost 1 percent in Hong Kong.
China Mobile and China Unicom each rose
1 percent, while China Telecom moved up 1.7 percent.