April 26, 2018 / 4:33 AM / 2 years ago

China, Hong Kong stocks fall, tech firms under pressure amid Huawei probe

* SSEC -0.9 pct, CSI300 -1.4 pct, HSI -0.7 pct

* HK->Shanghai Connect daily quota used 3.1 pct, Shanghai->HK daily quota used 0 pct

* FTSE China A50 -1.7 pct, BNY Mellon ADR China Select Index -0.7 pct

SHANGHAI, April 26 (Reuters) - China and Hong Kong stocks dropped on Thursday, as technology shares were under pressure amid Huawei probe. ** The CSI300 index fell 1.4 percent to 3,774.69 points at the end of the morning session, while the Shanghai Composite Index slipped 0.9 percent to 3,089.21 points. ** The Hang Seng index dropped 0.7 percent to 30,114.91 points, the Hong Kong China Enterprises Index lost 0.6 percent to 12,019.11. ** U.S. prosecutors in New York have been investigating whether Chinese technology company Huawei violated U.S. sanctions in relation to Iran, according to sources familiar with the situation. ** Since at least 2016, U.S. authorities have been probing Huawei’s alleged shipping of U.S.-origin products to Iran and other countries in violation of U.S. export and sanctions laws, two of the sources said. ** An index tracking IT and telecoms firms on the mainland dropped 1.8 percent and 1.6 percent respectively, as the Huawei probe added to investor worries over ZTE ban. ** IT firms in Hong Kong fell 1.4 percent. ** The slump in leading home appliances maker Gree Electric also weighed on the market, after the firm announced no annual dividend payment in cash for the first time since 2007, dampening appetite for other blue-chips posting solid results. ** “Investors shall be cautious for the moment, as we do not see any major sustainable investment themes,” said Chen Xiaopeng, an analyst with Sealand Securities. ** However, Chen expected little chances of a sharp downturn for China’s major stock indexes at the current levels, adding policymakers could roll out more supportive polices to hedge external uncertainties, including trade war tensions with the United States. ** China will further reduce taxes to support small firms and high-tech companies, state radio quoted the cabinet as saying on Wednesday, with seven measures expected to result in cuts of more than 60 billion yuan ($9.49 billion). ** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 0.02 percent, while Japan’s Nikkei index was up 0.57 percent. ** The yuan was quoted at 6.3238 per U.S. dollar, 0.05 percent firmer than the previous close of 6.327. ** The largest percentage gainers in the main Shanghai Composite index were Founder Technology Group Co Ltd, which gained 10.03 percent, followed by Shanghai Wondertek Software Co Ltd gaining 10.02 percent and Beijing Tricolor Technology Co Ltd up by 10.01 percent. ** The largest percentage losses in the Shanghai index were Henan Huanghe Whirlwind Co Ltd down 10.05 percent, followed by Pengqi Technology Development Co Ltd losing 10.04 percent and Qianhe Condiment and Food Co Ltd down by 10.01 percent. ** The top gainers among H-shares were Great Wall Motor Co Ltd up 5.23 percent, followed by Guangzhou Automobile Group Co Ltd gaining 1.41 percent and CNOOC Ltd up by 1.4 percent. ** The three biggest H-shares percentage decliners were China Vanke Co Ltd which lost 3.35 percent, Ping An Insurance Group Co of China Ltd which slipped 3.0 percent and CSPC Pharmaceutical Group Ltd down by 2.2 percent. ** As of 0418 GMT, China’s A-shares were trading at a premium of 22.09 percent over the Hong Kong-listed H-shares.

($1 = 6.3232 Chinese yuan)

Reporting by Luoyan Liu and John Ruwitch, Editing by Sherry Jacob-Phillips

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