* CSI300 -0.7 pct; SSEC -0.6 pct; HSI +0.2 pct
* Shanghai to gain nearly 10 pct in 2015, beating Wall Street
* 2016 expected to be another volatile year for China stocks
SHANGHAI, Dec 31 (Reuters) - China stocks fell on Thursday but the Shanghai market looked set to end 2015 up nearly 10 percent, easily beating Wall Street and most other major markets and shaking off a savage summer rout.
By the lunch break, the blue-chip CSI300 index lost 0.7 percent to 3,739.10 points, while the Shanghai Composite Index declined 0.6 percent, to 3,550.92 points.
Hong Kong stocks were little changed.
With just two more hours of trading left in 2015, the Shanghai market was on track to post an annual gain of around 9.8 percent, capping a year of wild fluctuations that sent shock waves across global markets.
In comparison, the S&P 500 index is up just 0.2 percent, while the Dow Jones Industrial Average is in negative territory. The Shanghai market has also outperformed most other major markets in Europe and Asia.
But the year in China was definitely not one for the faint-hearted.
Fuelled by excessive leverage, the Shanghai market surged nearly 60 percent early in the year before crashing in mid-June, wiping off about one-third of the market value in just three weeks.
An unprecedented and heavy handed government rescue programme has helped prices rebound about 25 percent from their August lows, but sentiment remains fragile.
A regulatory ban on large share sales that was imposed during the crash will expire in January.
While 2016 is expected to be another volatile year for China equities, some market watchers are expecting less drama, with Goldman Saches expecting the trading pattern to be “fat and flat.”
Qi Yifeng, an analyst at consultancy CEBM, identified two major sources of concern haunting Chinese investors next year: when will the economy bottom out, and whether the market can withstand a potential equity supply glut.
China plans to revamp its intial public offering system as soon as in March to make company listings easier.
Most sectors fell on Thursday and volume was light.
State-owned Chinese investment company Central Huijin Investment Ltd said on Thursday it plans to transfer the shares it bought in August during the government’s stock market rescue to a new asset management subsidiary.
The move may mean the shares will not immediately be sold, which should help to take some near-term pressure off the market, said analysts.
In Hong Kong, the Hang Seng index added 0.2 percent, to 21,914.40 points, while the Hong Kong China Enterprises Index was unchanged at 9,661.03.
The Hang Seng looks set to fall 7.2 percent this year, while the HSCE has slumped more than 19 percent.
Shares of China Power New Energy Development Co Ltd jumped 22.6 percent, heading for the biggest percentage gain in seven years, after it said its parent plans an asset injection.
Reporting by Samuel Shen and Nathaniel Taplin; Editing by Kim Coghill