China shares rose on Friday morning, reversing early losses as property counters surged after soft home price data triggered expectations of more mini-stimulus by local governments. Hong Kong's benchmark index opened down almost 1 percent, following weaker U.S. bourses after news of a downed Malaysian airliner at the Ukraine-Russia border rattled investors. Nearly 300 people were killed. A Ukrainian official said a missile was fired at the plane.
Some of Hong Kong's losses were erased after China markets regained momentum. At midday, the Hang Seng Index was off 0.5 percent at 23,415.99 points. The China Enterprises Index of the top Chinese listings in Hong Kong slipped 0.6 percent. On the week, the two indexes were up 0.8 and 0.3 percent, respectively.
The CSI300 of the leading Shanghai and Shenzhen A-share listings rose 0.7 percent, while the Shanghai Composite Index was up 0.4 percent at 2,063.76 points. They are now up 1.1 and 0.8 percent this week.
"It's mainly sentiment-driven today because of the airliner attack," said Steven Leung, sales director at brokerage UOB Kay Hian in Hong Kong. "But after the Chinese property prices (data) was released, investors tended to be more optimistic because they expect further policy-easing in China," Leung added.
China's average new home prices fell in June from May for a second straight month. Prices are expected to continue declining in coming months, and if they fall sharply, that could be a challenge to Beijing.
Expectations for more housing policy loosening by local governments were increased by a report in the 21st Century Business Herald. It said the new housing minister told a meeting that clearing inventories is a main second-half goal.
China Vanke added 3.8 percent in Shenzhen and Poly Real Estate jumped 6.4 percent in Shanghai. China Overseas Land & Investment rose 1.2 percent in Hong Kong.
The CSI300 real estate subindex was up 3.5 percent, the biggest one-day rise since April 2.
Chinese liquor makers were again outperformers on Friday, as investors expect the sector to draw interests from overseas funds helped by the coming Hong Kong-Shanghai Stock Connect project, which allows Hong Kong and mainland investors buy stocks in each other's market.
Kweichow Moutai, the top index boost, gained 5.6 percent and Anhui Gujing Distillery soared 7.8 percent to its highest in five months.
Shares of Chinese sportswear maker Li Ning tumbled 9.3 percent to a three-month low.
The company said late Thursday it expected that one-off charges and the cost of expanding its direct sales network will widen its January-June net loss to at least 550 million yuan ($88.69 million).
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