July 30, 2010 –   * Shanghai Comp falls 0.4 pct; Chalco up on joint venture

* Hong Kong up 4.5 pct in July, best since last September

* CKI, HKE gain after EDF deal

(Updates with closing prices)

By Chen Yixin and Donny Kwok

HONG KONG/SHANGHAI, July 30 (Reuters) - China's key stock index fell 0.4 percent on Friday, as investors cashed in on bank stock gains, while China Everbright Bank said it would list on the Shanghai market by Aug. 18, adding more pressure on liquidity.

Hong Kong stocks eased on Friday, ending an eight-session rising streak, but the index had its best monthly performance in the last 10 months as investors returned to pick up battered-down mainland shares.

The Shanghai Composite Index <.SSEC> ended at 2,637.5 points, down from Thursday's 0.6-percent gain, the highest close in two months.

The index has fallen 19.5 percent so far this year, hit by large fundraisings by banks and other financial firms and a clampdown on property speculation, although it rebounded 10 percent this month.

China Everbright Bank aims to complete its potential $2.9 billion Shanghai initial public offering by Aug. 18, joining larger rivals in tapping the market for funds after a 2009 lending binge dented balance sheets. [ID:nBJD000047]

"Today's adjustment is good for the future," said Cheng Yi, an analyst at Xiangcai Securities in Shanghai. "We expect the index will move to 2,680 points in coming days."

Almost all 15 banks listed on the Shanghai and Shenzhen markets fell, with Agriculture Bank of China <601288.SS>, the most active stock on the Shanghai market, dropping 1.4 percent.

Industrial and Commercial Bank of China <601398.SS>, China's second-largest capitalised stock, which has a nearly 7 percent weighting among Shanghai A shares, slipped 1.2 percent.

Bucking the index's fall, Aluminum Corp of China <601600.SS> jumped 6.7 percent after it said it had agreed to invest $1.35 billion in a Guinea joint venture that partner Rio Tinto <RIO.AX> claims is the world's largest undeveloped iron ore deposit. [ID:nSGE66S0OJ]

Turnover in Shanghai A shares fell to 94 billion yuan ($13.87 billion) from 133 billion yuan on Thursday, while losing shares outnumbered gainers 532 to 338.

HK AT MONHTLY BEST SINCE SEPT, TENCENT SHINES IN JULY

Hong Kong stocks eased 0.3 percent on Friday, ending an eight-session rising streak, as investors locked in gains ahead of a series of corporate earnings next week.

The key Hang Seng Index <.HSI> ended 64.01 points down at 21,029.81 after the index became trapped within a narrow 150-point range through the day. The index ended the month up 4.48 percent, its best monthly gain in percentage terms since September 2009.

The blue chip index failed to cross the 200-day moving average after testing that level for two days.

"The market took a breather after rising for eight consecutive sessions, and it was time to take the focal point back to the economy," said Linus Yip, strategist at First Shanghai Securities.

The China Enterprise Index <.HSCE> of top locally listed mainland firms fell 0.31 percent on Friday to 11,905. The index ended the month up 3.8 percent, its best since March 2010.

Turnover amounted to HK$51.45 billion ($6.62 billion), the lowest in nine days.

Shares of billionaire Li Ka-shing controlled Cheung Kong Infrastructure <1038.HK> climbed 0.69 percent and Hongkong Electric <0006.HK> gained 0.64 percent after the companies won an auction for power networks in Britain owned by EDF <EDF.PA> for $9.1 billion.

Cheung Kong Infrastructure and Hongkong Electric won an auction for three power distribution grids and private power networks owned in Britain by EDF, the world's second-largest utility. [ID:nNN2925276]

Shares of heavyweight and Europe's largest lender, HSBC <0005.HK>, which is expected to announce its earnings on Aug 2, fell 0.99 percent.

China's largest Internet firm, Tencent <0700.HK>, was the best performer on the blue chip index in July, with an almost 15 percent gain, rebounding from an 8-month low hit last month. The shares gained 0.67 percent on Friday.

Russian Internet firm Digital Sky Technologies, in which Tencent agreed to buy a 10 percent stake in April, aims to sell up to 25 percent of shares in its Russian unit in an IPO in 2011. [ID:nLDE66S0N4] ($1=6.776 Yuan) (Editing by Ken Wills)