* SSEC -1.1%, CSI300 -1.0%, HSI -1.2%
* HK->Shanghai Connect daily quota used -0.9%, Shanghai->HK daily quota used 2.8%
* FTSE China A50 -1.5%
SHANGHAI, July 10(Reuters) - Mainland China shares fell on Friday for the first time since June 29 on signs of renewed Sino-U.S. tensions and after the country’s state funds announced stake cuts in companies, a move that comes following a torrid bull run in the stock market.
** The bull run, encouraged by state media, has been fuelled by signs of an early economic recovery for China from the coronavirus, capital market reforms and accelerating inflows of foreign funds.
** At the midday break, the Shanghai Composite index was down 1.05% at 3,414.21 points, while the blue-chip CSI300 index was down 1%.
** The start-up board ChiNext Composite index was higher by 0.62%.
** For the week, SSEC gained 8.3%, while CSI300 climbed 8.4, both set for best weekly gains in more than five years.
** People’s Insurance Co (Group) of China and three China-listed tech companies said their major state shareholders plan to reduce holdings, dampening broader investor sentiment.
** The move came after regulators cracked down on margin financing and as Chinese official media urged retail stock investors to be prudent.
** The market could face a correction risk in the short term, analysts at Everbright Securities said in note.
** Denting sentiment further were reports that the United States imposed sanctions on the highest ranking Chinese official yet targeted over alleged human rights abuses against the Uighur Muslim minority, a move likely to further ratchet up tensions between Washington and Beijing.
** “Now investors should pay attention more to opportunities than risks, as A-shares are not overvalued,” said Jin Jing, an analyst with Caitong Securities.
** Investor enthusiasm would be hard to cool down for now, after the Shanghai benchmark index rallied past the landmark 3,000-point level, while a relatively friendly policy environment for the macro economy and capital markets also provides support, Jin added.
** Chinese H-shares listed in Hong Kong fell 1.62% to 10,607.66, while the Hang Seng Index was down 1.17% at 25,902.86.
** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 0.74%, while Japan’s Nikkei index was down 0.47%.
** The yuan was quoted at 7.0047 per U.S. dollar, 0.18% weaker than the previous close of 6.9924. (Reporting by Luoyan Liu and Andrew Galbraith, Editing by Sherry Jacob-Phillips)