* HSI -0.1 pct, H-shares +0.3 pct, CSI300 -0.2 pct
* Moutai almost flat on year, contamination fears linger
* AIA slips after Khazanah stake sale, AIG lockup expires
* China urbanization policy plays strong
By Clement Tan
HONG KONG, Dec 6 Chinese shares slipped from
three-week highs on Thursday, knocking Hong Kong off its highest
in more than a year, as liquor makers came under renewed
pressure over contamination fears.
Investors, however, continued to buy into Chinese financial
and urbanization-related sectors, a day after comments from the
new Communist Party chief setting the economic agenda for 2013
had lifted the A-share market off four-year lows.
The Hang Seng Index closed down 0.1 percent, after
opening at its highest intra-day level since August last year.
The China Enterprises of the top Chinese listings in
Hong Kong crept up 0.3 percent.
In the mainland, the CSI300 Index of the top
Shanghai and Shenzhen listings slipped 0.2 percent, while the
Shanghai Composite Index edged down 0.1 percent from its
highest since Nov. 14 set on Wednesday.
Hong Kong turnover and Shanghai volume each slipped more
than 30 percent from Wednesday's elevated levels, but were still
some way above their respective averages in the last 30 days.
Shares of China's top premium white spirit maker Kweichow
Moutai fell 5.8 percent in Shanghai as concerns over
excessive use of toxic substances lingered. Up nearly 30 percent
on the year at the end of October, Moutai is now barely 0.5
percent stronger in 2012.
Traders cited talk that independent tests on Moutai products
bought in Hong Kong could show further evidence of excessive
levels of plasticiser.
Shares of Mengniu Dairy shed 0.5 percent to its
lowest since end-June over similar concerns of contamination.
It is now down 6.4 percent this week, set for its worst week
in 2012. Chinese media reported that one of its yoghurt products
for children contains banned substances, which the company has
"If previous scares with Mengniu Dairy is any indication, it
will be a while before enthusiasm for these alcohol producers
return," said Edward Huang, an equity strategist with Haitong
CHINA POLICY PLAYS STRONG
In Hong Kong, HSBC Holdings slipped 0.5
percent after Reuters reported that Europe's largest bank may
pay a $1.8 billion fine to U.S regulators as part of a
settlement over money laundering lapses.
Asian insurance giant AIA Group shed 0.3 percent
to HK$30.10, at the top end of the HK$29.84-HK$30.20 range that
Malaysia's state investor Khazanah Nasional Bhd's
priced its $360 million offering of AIA shares.
Khazanah's selldown comes ahead of the expiration of a
lockup on AIA shares for American International Group on
Thursday, when the U.S. insurer will be free to sell a stake
worth $6.4 billion at current market prices.
Smaller Chinese banks extended Wednesday's gains after the
country's insurance regulator abolished, late on Tuesday,
investment limits on the country's banks for insurance firms
that previously prevented them from investing in more than two
banks if their ownership of individual banks exceeded 5 percent.
China Merchants Bank rose 2.4 percent
in Hong Kong and 0.4 percent in Shanghai, while Bank of Beijing
jumped 4.5 percent in Shanghai to a five-month high
and was among the top boosts to the CSI300.
Shares of Chinese insurers were marginally weaker on
Thursday after strong gains on Wednesday. China Life Insurance
slipped 0.2 percent in Hong Kong and 0.5
percent in Shanghai.
Chinese property counters were among the outperformers,
extending their strong gains on the year after new Communist
Party chief Xi Jinping listed tax reform, urbanization and a
bigger price-setting role for the market as key
His comments, published late on Tuesday, came ahead of the
party's central economic planning meeting later this month.
"Investors are aligning themselves along Beijing policy
lines more aggressively now after Xi Jinping's comments, but we
still lack details on the exact implementation," Haitong's Huang
China Vanke rose 1.4 percent in Shenzhen, while
China Resources Land climbed 1.7 percent in Hong Kong,
stretching its gains on the year to almost 70 percent.