China Shares Seesaw In Early Moves, With Financials Weak

By Michael KitchenMarketWatch Pulse

Chinese shares suffered further heavy volatility Thursday morning, with Hong Kong's Hang Seng Index and the Shanghai Composite Index swinging sharply between gains and losses in early trade. Half an hour into the session, the Hong Kong benchmark was up 0.1%, while the Shanghai index was down 0.3%, with the latter having opened 1.6% lower and then briefly enjoying modest gains before falling back. Financials were among the leading decliners on the Hong Kong market, where Haitong Securities Co. and China Everbright Ltd. lost 2.1% each, and Bank of Communications Co. fell 1%, though London-based HSBC Holdings PLC rose 0.4% on the back of Greece's passage of austerity measures required for a new bailout agreement. Mainland Chinese industrials also suffered, with BYD Co. down 3.3% and Zoomlion Heavy Industry Science & Technology Co. off 2.1%. Over in Shanghai, notable decliners included Dongfeng Motor Group Co. (down 3.1%), Sany Heavy Industry Co. (down 2.2%) and some of the energy shares (PetroChina Co. down 2.6%, China Petroleum & Chemical Corp. (Sinopec) down 3.6%), likely reacting to a pullback for crude-oil futures overnight. On the upside, China Eastern Airlines Corp. surged 7.4% in Hong Kong and rallied 4.3% in Shanghai after saying strong demand and weaker oil prices would result in a sharply higher first-half net profit. Hong Kong-listed real-estate names also saw some scattered gains, with Sino Land Co. up 0.7%, China Vanke Co. up 0.9%, and China Overseas Land & Investment Ltd. up 1% after announcing its sales results for June.

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