* HSI -1.4 pct, H-shares -1.6 pct, CSI300 -1.0 pct
* Chinese oil majors under pressure after oil prices dive
* Rail sector buck weakness, new govt investment expected
* Lenovo slips but Q2 earnings at midday beat estimates
HONG KONG, Nov 8 (Reuters) - Hong Kong shares tumbled 1.4
percent to their lowest in a week on Thursday, as investors took
profits on recent outperformers and refocused their attention on
the prospect of U.S. fiscal woes roiling financial markets.
But market participants said that while there may be blips,
the Hong Kong stock market would continue to benefit from fresh
money flows on the back of quantitative easing steps from the
U.S. Federal Reserve.
"Europe and the fiscal situation in the U.S. are the focus
right now but the uptrend for Chinese shares, particularly ones
listed in Hong Kong, remains intact," said Alan Lam, Julius
Baer's Greater China equity analyst.
"It's still very difficult to look beyond a three- or
six-month window at this point, but the next batch of data
tomorrow should do more to reassure investors that the slowdown
in China is stabilizing," he added.
The Hang Seng Index went into the midday trading
break at 21,790.5, its lowest intra-day level since Nov. 1 but
is up 18 percent for the year to date.
The China Enterprises Index of the top Chinese
listings in Hong Kong fell 1.6 percent. It is up 7 percent so
far this year and has outperformed Asia in the last two months
after lagging the broader Hong Kong market for most of the year.
On the mainland, the Shanghai Composite Index and
the CSI300 Index of the top Shanghai and Shenzhen
listings each lost 1 percent. They have not done as well as Hong
Kong stocks and are down 5.2 and 3.5 percent in 2012,
In another measure of warming interest in Chinese equities,
capital inflows into China stock exchange-traded funds (ETFs)in
October more than tripled September's total, according to an
International Liquidity Review report dated Nov. 7.
According to the same report, China stock ETFs saw some $1.7
billion of inflows in October, the healthiest inflows since the
beginning of 2011.
Beijing will post a fresh batch of economic data, starting
with inflation, urban investment, industrial output and retail
sales on Friday and trade on Saturday, with money supply and
loan growth expected any time between Nov. 10 and Nov. 15.
Investors are also eyeing the makeup of the new Politburo
Standing Committee at the 18th Party Congress meeting that
started in Beijing earlier on Thursday for the likely policy
approach of China's incoming leaders.
CHINA OIL MAJORS WEAK
On Thursday, shares of Chinese oil majors came under
pressure after oil prices dived 4 percent overnight on growing
economic headwinds on both sides of the Atlantic coast.
In Hong Kong, Petrochina Co Ltd shed 2.6 percent,
CNOOC Ltd fell 1.7 percent, while China Petroleum &
Chemical Corp (Sinopec) lost 1.6 percent.
Shipping, heavy machinery, coal and materials-related
sectors also saw some of the bigger losses on the day after
Shares of China Rongsheng Heavy Industries Group,
which surged 62 percent in Hong Kong last month, dived 4.2
percent on Thursday.
But the Chinese railway sector bucked broader market
weakness after mainland news outlets reported that Beijing could
raise its investment in the sector.
China Railway Group rose 2.4 percent in
Hong Kong and 1.1 percent in Shanghai. China Railway
Construction was up 0.7 percent in Hong
Kong and 0.8 percent in Shanghai.
Shares of Lenovo Group Ltd slid 2.2 percent in
Hong Kong ahead of second-quarter corporate earnings. At midday,
the Chinese PC maker posted a better-than-expected 12.6 percent
rise in quarterly net profit, but still its weakest growth in
about three years.
Its shares are up almost 28 percent this year and are
currently trading at a 9 percent discount to its 12-month
forward price-to-book earnings, according to Thomson Reuters