June 8, 2018 / 4:25 AM / a year ago

China, Hong Kong stocks slide on concerns over 'unicorns' listings

* SSEC -1.3 pct, CSI300 -1.3 pct, HSI -1.2 pct

* HK->Shanghai Connect daily quota used -0.1 pct, Shanghai->HK daily quota used -1.4 pct

* FTSE China A50 -1.4 pct, BNY Mellon ADR China Select Index -0.3 pct

SHANGHAI, June 8 (Reuters) - China and Hong Kong stocks fell on Friday as investors were worried about the impact from the listings of big-cap “unicorns”, and amid uncertainty over trade relations. ** The CSI300 index was down 1.3 percent at 3,780.62 points at the end of the morning session, while the Shanghai Composite Index lost 1.3 percent to 3,070.48 points. ** The Hang Seng index dropped 1.2 percent, to 31,126.40 points, while the Hong Kong China Enterprises Index lost 1.3 percent, to 12,241.06. ** Foxconn Industrial Internet Co Ltd (FII), a unit of the world’s largest contract manufacturer, became China’s biggest domestically listed tech company by market cap on Friday as its shares soared a maximum 44 percent on debut. ** “The listings of big-cap unicorns, such as Foxconn Industrial Internet, will have a negative impact on the liquidity conditions of the stock market,” said Chen Xiaopeng, an analyst with Sealand Securities. ** “The financing need from China Depositary Receipts, or CDRs, could have an even worse impact,” added Chen. ** The domestic flotation of offshore-listed tech giants via CDRs could generate a financing need ranging from 116 billion yuan to 528 billion yuan, according to calculations of Chen Guo, an analyst with Essence Securities. ** China has adopted new rules governing the issuance of securities that will allow the domestic flotation of overseas-listed innovator. ** China’s securities regulator in early May published draft rules on the issuance of CDRs, laying the foundation for innovative companies to return to the domestic capital markets. ** Adding to worries was the uncertainty over trade relations ahead of a key meeting of global leaders. ** Leaders of the Group of Seven rich nations headed for a summit in Canada on Thursday more divided than at any time in the group’s 42-year history, as U.S. President Donald Trump’s “America First” policies risk causing a global trade war and deep diplomatic schisms. ** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.01 percent, while Japan’s Nikkei index was down 0.32 percent . ** The yuan was quoted at 6.4029 per U.S. dollar, 0.15 percent weaker than the previous close of 6.3931. ** The largest percentage gainers on the main Shanghai Composite index were Suzhou Chunqiu Electronic Technology Co Ltd up 9.98 percent, followed by Jiangsu Luokai Mechanical & Electrical Co Ltd gaining 6.63 percent and Shenzhen Geoway Co Ltd up by 6.41 percent. ** The largest percentage losers on the Shanghai index were Henan Yinge Industrial Investment Co Ltd down 10.04 percent, followed by Harbin Churin Group Jointstock Co Ltd losing 7.68 percent and Jinneng Science & Technology Co Ltd down by 7.55 percent. ** The top gainers among H-shares were PetroChina Co Ltd up 0.91 percent, followed by China Railway Group Ltd gaining 0.16 percent and Shenzhou International Group Holdings Ltd up by 0.05 percent. ** The three biggest H-shares percentage decliners were China Gas Holdings Ltd, which has fallen 7.54 percent, Great Wall Motor Co Ltd, which has lost 4.9 percent, and ZhongAn Online P & C Insurance Co Ltd down by 4.3 percent. ** About 7.38 billion shares have traded so far on the Shanghai exchange, roughly 55.6 percent of the market’s 30-day moving average of 13.28 billion shares a day. The volume traded was 12.78 billion as of the last full trading day. ** As of 04:01 GMT, China’s A-shares were trading at a premium of 16.71 percent over the Hong Kong-listed H-shares.

Reporting by Luoyan Liu and John Ruwitch; Editing by Subhranshu Sahu

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