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HK shares seen weak on China worries; CNOOC eyed

Published 08/26/2009, 09:38 PM
Updated 08/26/2009, 09:39 PM
USD/JPY
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HONG KONG, Aug 27 (Reuters) - Hong Kong shares are seen lower on Thursday with investors opting to stay on the sidelines amid uncertainties about the pace of the economic recovery in China and a likely clampdown on lending on the mainland.

Most major Asian markets got off to a weak start on Thursday despite a flat finish on Wall Street overnight.

China's top offshore oil producer CNOOC will be watched after it reported a 55 percent drop in first-half earnings, its lowest half-year profit since early 2005, after a plunge in crude oil prices squeezed margins.

Top earnings on Thursday include Bank of China, PetroChina and China COSCO.

The benchmark Hang Seng Index was little changed by the close of Wednesday's session, with thin turnover at the lowest in six weeks, even as strong earnings momentum buoyed select shares including China Life.

STOCKS TO WATCH

* Chinese supermarket chain Times Ltd said late on Wednesday that a strategic review, which might result in a general offer by potential bidders, remains ongoing and the company has not entered into any agreements yet. Trading in the shares, which suspended on Wednesday, will resume on Thursday. For statement please click http://www.hkexnews.hk/listedco/listconews/sehk/20090826/LTN20090826547.pdf

* China BlueChemical said its first-half net profit fell 46.7 percent year on year to 583.1 million yuan on a decrease in selling prices of fertilisers and methanol, and it said the national measures on fertilisers reserves would help stabilise domestic prices of fertilisers in the second half of the year. For statement please click http://www.hkexnews.hk/listedco/listconews/sehk/20090826/LTN20090826591.pdf

* Canada's Eldorado Gold Corp said on Wednesday that it will buy Sino Gold Mining Ltd for C$2.0 billion ($1.84 billion) in an all-share deal that will more than double the size of its gold production in China.

* Homegrown sport brand Li Ning Company Ltd said its first-half net profit rose 41.6 percent to 473 million yuan and the number of retail stores increased by 564 to 6,809 mostly in second- and third-tier Chinese cities. It said it would continue to expand the retail network and improve store performance in the second half year. For statemen please click http://www.hkexnews.hk/listedco/listconews/sehk/20090826/LTN20090826415.pdf

* China's top offshore oil producer, CNOOC Ltd, said it will take a conservative approach to acquisitions after reporting its lowest half-year earnings since 2005 on weak crude oil prices.

* Dongfeng Motor Group, China's No.3 carmaker, said it expects the domestic market to grow an average 15 percent over each of the next three years, fueled by strong demand among an emerging middle class.

* Esprit, the world's No.6 fashion retailer by market value, on Wednesday posted a 40 percent fall in second-half profit, as global economic woes took a bite out of its core European market. But the company said it would focus on expansion to tap potential growth as the economy recovers.

----------------------MARKET SNAPSHOT @ 2242 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG S&P 500 <.SPX> 1028.12 0.01% 0.120 USD/JPY 94.24 0.03% 0.030 10-YR US TSY YLD 3.4347 -- 0.000 SPOT GOLD 943.85 -0.03% -0.250 US CRUDE 71.66 0.32% 0.230 DOW JONES <.DJI> 9543.52 0.04% 4.23 ASIA ADRS <.BKAS> 121.24 -0.02% -0.02 -------------------------------------------------------------

MARKETS SUMMARY *Wall St ends flat; caution lingers after rally [nN26282689] *Oil falls on rising U.S. stockpiles [nSP475982] *Dollar gains as risk trade takes a breather [nN26280895] *Treasuries hold firm on solid 5-year bond auction [nN2668860] (Reporting by Parvathy Ullatil; Editing by Chris Lewis)

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