China, HK stocks rise as weak factory activity stokes stimulus hopes
* CSI300 +0.9 pct; SSEC +0.9 pct; HSI: +0.4 pct
* China factory activity slips, reinforces stimulus hopes
* Real estate stocks up on signs of stabilisation in major cities
By Samuel Shen and Kazunori Takada
SHANGHAI, May 4 (Reuters) - China and Hong Kong stocks rose on Monday, with construction and energy stocks taking the lead, as poor Chinese factory activity data reinforced expectations of fresh government stimulus.
The China HSBC PMI index dropped to 48.9 in April, showing that the country's factories suffered their fastest drop in activity for a year as new orders fell.
Further underscoring the need for more stimulus to shore up faltering growth, the State Information Centre, a top government think tank forecast that China's economy could slow further to 6.8 percent in the second quarter from a six-year low of 7 percent in the first.
"The economy is still weak. It's still trending lower," said Liu Haiying, chief economist at Capital Edge Investment Management Co in Shanghai, who said an interest rate cut this month was "very likely".
"But since this round of bull run is fuelled by liquidity, not by corporate earnings, I don't think the rally has come to an end, although there will be increasing fluctuations," he said, citing risks including fresh regulatory crackdown on speculation. Continuación...