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Hong Kong, Shanghai stocks fall after China data

Hong Kong - Hong Kong and stocks fell 1.06% following another Wall Street sell-off and after worse-than-expected Chinese manufacturing data, while Shanghai snapped a six-session winning streak.

The benchmark Hang Seng Index lost 270.34 points to 25 128.51 on turnover of HK$78.36bn.

The preliminary reading of Caixin's Purchasing Manager's Index (PMI) - an independent survey - came in at 48.2 this month, the weakest reading since 48.1 in April 2014.

The PMI report knocked the wind out of a recent upturn in Hong Kong and Shanghai after Chinese leaders unveiled a slew of measures to curb a mainland market rout since mid-June, including a police crackdown on short-selling and a ban on big shareholders from selling stock for six months.

Shanghai had tacked on more than 17% since the measures were announced on July 8 in response to a plunge that saw the index drop about a third and trillions wiped off valuations.

"The PMI data was rather poor and surprised most analysts," Gerry Alfonso, a sales trader at Shenwan Hongyuan Group in Shanghai, told Bloomberg News.

"The support measures introduced by the authorities in the mainland to stabilise the market have little impact in share prices in Hong Kong," where investors are more sensitive to economic fundamentals, he said.

US shares retreated for a third day in a row following disappointing earnings from American Express, Caterpillar and 3M.

The Dow fell 0.67%, the S&P 500 dropped 0.57% and the Nasdaq gave up 0.49%.

Six-day rally

Among Hong Kong's losers, Tencent shed 1.94% to HK$151.50, HSBC dropped 1.71% to HK$69.15 and insurance giant AIA slipped 1.65% to HK$50.60.

Footwear maker Belle International was 1.40% down at HK$8.43 and Lenovo eased 0.33% to K$9.17.

However, casino operators rose on hopes Macau's government will put off plans to introduce a smoking ban on gaming floors.

Sands China rose 1.50% to HK$33.85 and Galaxy Entertainment was up 0.29% at HK$34.90.

Shanghai stocks sank 1.29% on Friday after a six-day rally as data showed manufacturing activity in the world's number two economy hit a 15-month low in July, dealers said.

The Shanghai Composite Index fell 53.01 points to 4 070.91 on turnover of 843.0 billion yuan. However, it still gained 2.87% for the week.

The Shenzhen Composite Index, which tracks stocks on China's second exchange, lost 1.27% to 2 322.71 on turnover of 744.2 billion yuan. It added 6.04% over the week.

"The market is faced with big pressure at the current level. The chance for a big breakthrough and further rises are slim," Gui Haoming, an analyst from Shenwan Hongyuan, told AFP.

There had been some hope for the Chinese economy after Beijing released figures last week showing growth at 7.0% in April-June, better then forecast.

Securities firms fell in Shanghai. Founder Securities lost 2.20% to 10.21 yuan and Sinolink Securities dropped 4.67% to 19.39 yuan.

Transport stocks also lost ground. In Shanghai, Daqin Railway slid 3.93% to 10.99 yuan and Dazhong Transportation fell 3.60% to 14.44 yuan.

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