HK shares drop 1.9 pct after rally; shippers gain

* Blue chips retract after Monday’s 8.7 pct rally

* Commodity counters notch up gains on higher oil

* China Cosco surges on global freight index rebound (Updates to close)

HONG KONG, Dec 9 (Reuters) - Hong Kong shares dropped 1.9 percent on Tuesday, with gains in oil and metal stocks offset by a pullback in other blue chips following the previous session’s steep rally.

Worries about poor November economic data from the United States and China in the coming days accelerated the market’s descent in the afternoon session.

Dodging the downdraft, China's largest shipping conglomerate China Cosco 1919.HK surged 11.8 percent on Tuesday after the Baltic Dry Index .BADI, which gauges changes in the prices of shipping commodities, broke its three-week losing streak to gain more than 1 percent overnight.

China Shipping Development 1138.HK followed suit with a 6.2 percent rally while port operator China Merchants Holdings 0144.HK jumped 5.1 percent.

The benchmark Hang Seng Index .HSI finished 291.65 points lower at 14,753.22 led by a 4.2 percent fall in heavyweight China Mobile 0941.HK.

Earlier Tuesday the index rose more than 1 percent on expectations of bigger and bolder steps from governments to revive the global economy after U.S. President-elect Barrack Obama proposed a massive public works investment and U.S. automakers inched closer to securing a government handout.

“The outlook is pretty mixed at this point. While the sentiment has improved a bit, the market had gained too much too fast and we are bound to give up another 300-500 points in the near term,” said Alex Wong, director with Ample Finance.

“China has yet to announce the big stimulus plan it is rumoured to be working on and investors are getting a bit impatient now, also there are worries about more industries lining up for bailouts if the U.S. carmakers are rescued.”

Turnover dropped, with shares worth HK$56.9 billion changing hands compared with HK$63.9 billion on Monday.

The China Enterprises Index of top locally listed mainland Chinese firms .HSCE dropped 1.7 percent to 8,001.74.


Commodity-linked stocks led gainers on the main index as oil prices held steady on Tuesday after surging 7 percent overnight on an equity market rebound and signs of deepening cuts from top supplier Saudi Arabia.

Shares in offshore oil specialist CNOOC 0883.HK jumped 4.4 percent.

China Shenhua 1088.HK, the world's most valuable coal miner, gained 4.1 percent while smaller rival China Coal Energy 1898.HK soared 8.9 percent.

Metal stocks also rose on resurgent commodity prices as stimulus measures from governments across the world are seen steadying plunging demand for raw materials.

“The global economic outlook is looking a little less dire with stock markets staging a slight rebound and all the support coming in from the big rescue measures planned by various governments,” said Andrew To, sales director with Tai Fook Securities.

Gold miner Zijin Mining 2899.HK added 3 percent.

Jiangxi Copper 0358.HK climbed 4.4 percent while Angang Steel 0347.HK put on 5.9 percent.

Reporting by Parvathy Ullatil; Editing by Ken Wills