* SSEC +0.1 pct, CSI300 flat, HSI -0.3 pct
* Profits of Chinese industrial firms jump 31.5 pct y/y in
* China curbs commercial property purchases in Beijing
SHANGHAI, March 27 China stocks barely budged on
Monday morning, as any optimism felt from data showing surging
profits at Chinese industrial firms was offset by fresh property
curbs and signs that monetary policy may be further tightened.
Hong Kong shares fell, as the market gave a cold welcome to
Beijing-backed Carrie Lam, who was elected on Sunday as the
city's chief executive.
China's blue-chip CSI300 index was unchanged at
3,488.87 points by the lunch break, while the Shanghai Composite
Index gained 0.1 percent, to 3,274.01 points.
Offering fresh signs of China's economic recovery, profits
of Chinese industrial firms surged 31.5 percent in the first two
months of 2017 from a year earlier, as commodity prices jumped.
But a market response was muted by Beijing's fresh measures
to ward off asset price bubbles.
China introduced rules to curb the purchase of new
commercial property in Beijing by individuals in the
government's latest step to cool the property market, while the
central bank chose not to inject funds into the banking system
citing "relatively high levels of liquidity".
Underscoring the shift in Beijing's policy focus, Zhou
Xiaochuan, governor of the People's Bank of China (PBOC) said on
Sunday that he expects to see more countries start to emphasize
fiscal policy and structural reform as the period of loose
monetary policy ends.
Ye Song, fund manager at Chang Xin Asset Management, wrote
in an annual fund report on Monday that the market will likely
be volatile in the near term as good news co-exists with bad
On the bright side, listed companies' profitability is
improving due to the economic recovery, and equities are a
better investment than bonds and property amid the government's
deleveraging campaign, he wrote.
On the dark side, "interest rates are climbing higher, while
the property curbs and deleveraging efforts cast doubt on the
sustainability of the recovery, suppressing equity valuations."
Most sectors fell on Monday, but transportation
and banking stocks were firm.
In Hong Kong, the Hang Seng index dropped 0.3
percent, to 24,290.72 points, while the Hong Kong China
Enterprises Index shed 0.6 percent, to 10,417.22.
Nearly all sectors lost ground, with materials and
property shares among the worst performers.
China Vanke Co Ltd, the mainland's second-biggest
homebuilder, dropped 3.3 percent in Hong Kong after posting 2016
profit that fell short of estimates.
(Samuel Shen and John Ruwitch)