Hong Kong shares head for 3rd straight loss, China still sluggish
* HSI -0.7 pct, H-shares -0.9 pct, CSI300 +0.2 pct
* HK property slides after big banks hike mortgage rates
* Mortgage rate hikes unlikely aggressive: Credit Suisse
* China Mobile, Ping An Insurance slip pre-2012 earnings
HONG KONG, March 14 (Reuters) - Hong Kong shares were headed for a third-straight daily loss on Thursday, led by local property developers after two of the territory's leading lenders raised mortgage rates for the first time since 2011.
Onshore Chinese markets stayed sluggish in tepid volume ahead of the close of the country's annual parliamentary meetings in Beijing at which saw Xi Jinping formally unveiled as China's new president.
The CSI300 of the leading Shanghai and Shenzhen A-share listings went into the midday trading break up 0.2 percent, while the Shanghai Composite Index was flat. Both indexes have had five-day losing streaks taking them to two-month lows.
The Hang Seng Index was down 0.7 percent at 22,395.5, its lowest since mid-December. The China Enterprises Index of the top Chinese listings in Hong Kong was down 0.9 percent.
"I don't think demand or home prices will be too adversely affected by yesterday's mortgage hikes, but it's a trigger for a stock market that is still looking for a bottom," said Jackson Wong, Tanrich Securities' vice-president for equity sales.
After markets closed on Wednesday, HSBC and Standard Chartered announced a 25 basis point hike in mortgage lending rates. Hang Seng Bank followed suit on Thursday. This follows the Hong Kong Monetary Authority's move last month to tighten home loan approvals.
Sun Hung Kai Properties sank 3.9 percent to its lowest since November, while Henderson Land dived 4.2 percent to a six-month low and Cheung Kong Holdings slid 2.7 percent.
While other lenders in the territory are expected to raise mortgage rates, Credit Suisse analysts said banks may not be too aggressive given shrinking mortgage volumes after the recent government measures.
"We believe the increase in the mortgage rate will have limited impact on affordability," Credit Suisse's Cusson Leong and Joyce Kwok wrote in a note dated March 14. They suggested investors buy on weakness, with Sun Hung Kai Properties and Henderson Land among their top picks.
Deutsche Bank forecast that with the government moves, possible further rises in mortgage rates and expected increases in housing supply, home prices in Hong Kong may fall between 15 and 20 percent in the next 24 months.
CHINA EARNINGS IN FOCUS
Investors are looking to gauge the impact on Chinese companies following economic data pointing to a more subdued economic recovery and the central bank governor's hawkish comments signalling a pull back from loose monetary policy.
China Mobile and Ping An Insurance each slipped 0.2 percent ahead of their respective full year 2012 corporate earnings.
At the midday break, China Mobile Ltd, valued at $220 billion of half an Apple Inc, posted a 2.7 percent rise in 2012 net profit, the slowest in three years, as the world's largest mobile operator by subscribers grappled with low-end users and high handset subsidies.
Shares of China Mobile, down 8 percent on the year, are currently trading at a 9 percent discount to the median 12-month forward earnings multiple, according to Thomson Reuters StarMine.
Ping An Insurance's Hong Kong shares are down 4.5 percent on the year and are trading at a 40 percent discount to their median forward 12-month earnings multiple, according to StarMine.