* CSI300 +0.4 pct; SSEC +0.1 pct; HSI +0.2 pct
* Drop in treasury yields makes blue-chips appealing - trader
* Acquisitions in New China Life stir interest in financials
SHANGHAI, Aug 11 (Reuters) - China stocks were firm on Thursday morning while Hong Kong shares hovered around eight-month highs, as a further decline in Chinese and global bond yields increased the appeal of blue-chips.
Financial plays were strong, aided by acquisitions of stakes in New China Life Insurance .
China’s blue-chip CSI300 index rose 0.4 percent, to 3,255.58 points by the lunch break, while the Shanghai Composite Index gained 0.1 percent, to 3,021.44 points.
In Hong Kong, the Hang Seng index added 0.2 percent while the Hong Kong China Enterprises Index gained 0.8 percent.
China’s benchmark 10-year government bond yields fell again on Thursday, hitting a fresh low since the 2009 global financial crisis, taking cues from slides in global yields.
“Government bond yields are perceived as risk-free rates. If these yields fall, stocks with low valuations would become more attractive, especially those with high payout ratios,” said David Dai, investor director at Nanhai Fund Management Co.
“In addition, we have seen a flurry of acquisitions recently, which has also stirred interest in some key sectors such as financials.”
New China Life jumped 6.1 percent in Shanghai, touching a seven-month intraday high, after saying five companies controlled by Guo Guangchang, billionaire chairman of Fosun Group, had acquired a combined 5.01 percent stake in the Chinese insurer. New China Life’s Hong Kong-traded shares gained 3.5 percent.
The news helped push the financial sector up 1.2 percent in China and 0.7 percent in Hong Kong as insurers strengthened.
Banks were also firm, after Hua Xia Bank posted a 6.1 percent rise in first-half profit while Shanghai Pudong Development Bank reported a 12 percent gain in earnings, easing concerns that a slowing economy would hit Chinese lenders’ balance sheets badly.
But raw material stocks in China corrected following strong sessions recently, while energy shares sagged in both mainland and Hong Kong markets as oil prices tumbled.
Reporting by Samuel Shen and Pete Sweeney; Editing by Richard Borsuk