China stocks rise as Beijing slashes U.S. tariffs amid virus spread

(Adds analyst comment on tariff cut, updates prices)

* SSEC +1.5%, CSI300 +1.6%, HSI +2.8

* China to halve some U.S. tariffs starting on Feb. 14

* Stocks track global rally amid rumours of coronavirus vaccine

HONG KONG, Feb 6 (Reuters) - China shares climbed for a third session on Thursday as Beijing said it will soon halve tariffs on some goods from the United States, easing concerns about the long-term outlook for the economy that is facing a sharp blow from a virus outbreak.

** At the midday break, the Shanghai Composite index jumped 1.5% in early afternoon trade, while the blue-chip CSI300 index was up 1.6%. ** CSI300’s financial sector sub-index rose 1%, the consumer staples sector gained 2.1% and the healthcare sub-index was up 3.8%. ** Chinese H-shares listed in Hong Kong and the Hang Seng Index climbed 2.8% each. ** The smaller Shenzhen index was up 2.4% and the start-up board ChiNext Composite index rose 2.9%. ** Shortly after the morning session, China said it will halve tariffs on some goods imported from the United States starting on Feb. 14, and reiterated that it hopes it can work with Washington to eventually scrap all tariffs in bilateral trade. ** “This helps shift the focus a bit,” said Linus Yip, chief strategist at First Shanghai Securities. “Long-term investors have been allocating Chinese equities since Monday’s drop. Any good news would accelerate that, and anything that helps fight the epidemic or the economy is good news.” ** Domestic markets were also lifted by a global rally late Wednesday that traders attributed to vague rumours of a possible vaccine or a drug breakthrough for the coronavirus, although they also said such catalysts were likely to be an excuse for short-covering. ** The World Health Organization played down such media reports on Wednesday of “breakthrough” of drug discovery. ** Share prices this week were also aided by policymakers’ efforts to prevent heavy selling, including liquidity injections and de facto restrictions on selling. ** “We believe market valuations currently are relatively attractive, (we) can also expect adjustment policy (support),” analysts at Galaxy Securities wrote in a report on Thursday, though they added it will take time for stocks to recover. ** Others remain sceptical. Pictet Asset Management said on Thursday they have reduced equities “across the board” in Hong Kong and Mainland China as these are “economies that are most affected” by the coronavirus. ** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.7%, while Japan’s Nikkei index was up 2.6%. ** As of midday, China’s A-shares were trading at a premium of 23.30% over the Hong Kong-listed H-shares. ** The Shanghai stock index is below its 50-day moving average and below its 200-day moving average.

Reporting by Noah Sin in Hong Kong, Editing by Sherry Jacob-Phillips