Hong Kong shares may trim strong 2013 start after Fed voices concern

Reuters Middle East

HONG KONG, Jan 4 (Reuters) - Hong Kong shares could end a

two-day rally on Friday, tracking Wall Street weakness after

signs that the U.S. Federal Reserve has growing concerns about

its stimulative monetary policy.

Any losses could be limited if mainland China markets reopen

strongly on Friday, trading for the first day in 2013 after a

three-day New Year holiday.

On Thursday, the Hang Seng Index ended up 0.4 percent

at 23,398.6, its highest since June 1, 2011. The China

Enterprises Index of the top Chinese listings in Hong

Kong added 0.8 percent, reaching another peak since August 2011.

On the week, the indexes are up 3.2 and 5.5 percent,

respectively. The H-share index's relative strength index (RSI)

value suggests that it is now at its most overbought since

October 2010.

Elsewhere in Asia, Japan's Nikkei is up 3 percent in

its first trading session for the year, while South Korea's

KOSPI is down 0.4 percent at 0042 GMT.

FACTORS TO WATCH:

* Consolidation of Austria's cutthroat telecom market moved

ahead on Thursday when Hutchison Whampoa Ltd completed

its 1.3 billion euro ($1.7 billion) takeover of Orange Austria,

making it the country's third-biggest mobile operator.

* Hong Kong's Li & Fung Group agreed to acquire a

majority stake in South Korean children's apparel maker Suhyang

Networks for roughly 200 billion won ($188 million), a South

Korean newspaper reported on Thursday.

* Hong Kong November 2012 retail sales rose 9.5 percent from

a year earlier.

* Bestway International Holdings Ltd has cancelled

part of its mining area in Mongolia due to the implementation of

new regulations.

* Chinese property developer Kaisa Group Holdings Ltd

has issued $500 million in senior notes due 2020

bearing an interest rate of 10.25 percent per annum.

* Chinese property developer Country Garden has

issued $750 million senior notes due 2023 with an interest rate

of 7.5 percent per annum.(Reporting by Clement Tan and Lee Chyen Yee; Editing by Matt

Driskill)

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