* CSI300 -1.2 pct; SSEC -0.9 pct; HSI flat
* China approves 24 IPOs; renews concerns over liquidity
* Financial stocks lead the decline
By Samuel Shen and Kazunori Takada
SHANGHAI, March 3 (Reuters) - China stocks sagged on Tuesday as investor excitement over a weekend interest rate cut waned, with a flood of new initial public offerings (IPO) fanning concerns about tighter liquidity.
With no fresh stimulus expected during this week's National People's Congress (NPC), investors are shifting their eyes to economic fundamentals and near-term liquidity as 24 companies won regulatory approval late on Monday to launch IPOs.
"The rate cut was expected, and it shows that the economy is rather poor," said Hou Yinmin, strategist of AJ Securities.
"I don't see signs of fresh money flowing into the stock market so new IPOs would have some pressure on liquidity."
When the securities regulator approved the previous batch of IPOs in early February, it froze about 2 trillion yuan ($318.76 billion) worth of liquidity at one point, putting pressure on the stock market.
Analysts said it was still too early to estimate how much liquidity would be frozen from the current IPOs.
The CSI300 index fell 1.2 percent to 3,558.97 points in morning trade, while the Shanghai Composite Index lost 0.9 percent to 3,305.45 points. Both indexes are approaching January highs, which are seen by analysts as a strong resistance level.
Hong Kong's Hang Seng index was little changed at 24,892.25 points, with a strong performance on Wall Street helping to offset concerns about China's slowing economy.
The Nasdaq on Monday closed above 5,000 for the first time since the year 2000 dot-com bubble, while the S&P 500 and Dow indexes hit records after economic data pointed to a slowly accelerating economy.
Analysts said mainland stocks have entered a consolidation period which could last several months, before resuming upward momentum as Beijing is expected to announce additional measures this year to support the economy.
Partly reflecting the risks of taking an overly-pessimistic view on China's economy, and the stock market, there was no single short-selling transaction involving mainland stocks conducted through the Shanghai-Hong Kong Stock Connect on Monday, the first day such a tool was open to foreign investors under the scheme.
Banking shares led the decline on Tuesday. Analysts say China's quarter-point interest rate cut on Saturday, coupled with further interest rate liberalisation, would hurt lenders' profit margins.
Shares of major Chinese brokerages, including CITIC Securities and Haitong Securities fell after China's securities regulator awarded Internet brokerage licences to 20 players in a pilot scheme.
"This would put further downward pressure on commission rates in an already crowded market and would potentially hurt the business of major brokerages," said Hou of AJ Securities. (Editing by Kim Coghill)