China shares closed at their lowest since December on Monday, with bird flu worries hitting tourism-related stocks and property stocks losing ground on more sales curbs as markets reopened after a holiday break. The Hong Kong market lingered at four-month lows, where indexes had ended last Friday, with strength in Chinese banks and airlines offsetting weakness in energy and property counters ahead of a slew of China economic data starting on Tuesday.
The CSI300 of the leading Shanghai and Shenzhen A-share listings ended down 0.5 percent at its lowest since December 27. The Shanghai Composite Index shed 0.6 percent. Shanghai volume was the third-lowest in 2013 as money market rates stayed mixed with an abundance of liquidity offset by caution ahead of Tuesday's central bank open market operations, traders said.
Both benchmarks dipped below their 100-day moving averages, but only the Shanghai index finished the day below that technical level for the first time since mid-December. Mainland markets were closed Thursday and Friday for holidays. The Hang Seng Index and the China Enterprises Index of the top Chinese listings in Hong Kong both ended flat on the day, staying at their lowest levels since November 28 as turnover sank almost 25 percent from Friday. The Hang Seng ended at 21,718.1.
"People are still very cautious today after the big dip in Hong Kong on Friday," said Jackson Wong, vice-president for equity sales at Tanrich Securities. Beijing is due to start releasing monthly and quarterly economic data, starting with March inflation on April 9 and trade on April 10 with money supply expected between April 10 and 15.
First quarter GDP growth data is due on April 15 along with industrial output, retail sales and urban investment data for March. Data last Wednesday showed growth in China's services sector rose to multi-month highs in March. On Monday, shares of Italian fashion house Prada SpA tumbled 4 percent after its 2012 core earnings and margins disappointed despite a boost to margins through a reduced discount sales period and better distribution control. Traders said some investors rotated into its footwear sector rival, China's Belle International, driving its shares up 4.3 percent from Friday's nine-month low.
China airline stocks listed in the mainland fell on fears of diminished demand for air travel if the bird flu outbreak turns into a pandemic. Air China, down more than 7 percent at one point, finished down 3.4 percent in Shanghai. Air China's Hong Kong listing rebounded 5.1 percent after Credit Suisse lifted its view of the Asian airline sector to overweight, following a price tumble on Friday the brokerage saw as a buying opportunity.
That day, Air China suffered its worst loss in nearly four years in Hong Kong, plunging almost 10 percent. Bird flu jitters were also cited for lackluster secondary housing market sales in Hong Kong over the weekend, broadly hurting the share prices of local property developers. New World Development shed 1.3 percent.
Chinese property developers were also on the defensive in the mainland after the official media reported on Monday that Beijing is likely to raise down-payment requirements for buyers taking commercial loans to purchase second homes to 70 percent. China Vanke fell 2 percent in Shenzhen, while Poly Real Estate shed 2.1 percent in Shanghai and China Resources Land slipped 0.7 percent in Hong Kong.