* SSEC -0.8 pct, CSI300 -0.7 pct, HSI -0.2 pct
* New asset management rules seen curbing risk appetite
* UBS AM launches onshore China fund, sees opportunities
SHANGHAI, Nov 20 (Reuters) - China stocks skidded on Monday after Beijing set sweeping new guidelines to regulate asset management products, which analysts said will dampen investors' appetite for riskier assets.
The central bank issued the new guidelines on Friday to more strictly regulate asset management businesses, in the government's latest effort to rein in the risky shadow banking sector which had been channelling money into Chinese stocks, bonds and property.
At the end of 2016, the collective outstanding volume of the asset management business was 102 trillion yuan ($15.38 trillion).
Shanghai's benchmark index SSEC tumbled as much as 1.4 percent to a two-month low, before recouping some losses to end the morning down 0.8 percent at 3,355.58 points.
Barring a further rebound, the Shanghai market is on track for its worst day in three months.
The blue-chip CSI300 Index dropped as much as 1.5 percent, and was down 0.7 percent at the lunch break at 4,092.25.
The draft guidelines, which will unify rules covering asset management products issued by all types of financial institutions, and will set leverage ceilings on such products, won't have an immediate impact. There will be a transition period that lasts until June 30, 2019.
Still, there was a psychological impact on the market as it reinforced views regulators will continue to tighten their grip on riskier areas of the financial system.
"Tougher rules on banks' wealth management products will seriously curb money flows into the stock market from lenders," Li Haoshu, analyst at Chuangcai Securities, wrote in a market comment.
"In addition, restrictions on leverage will hurt liquidity levels, and hurt risk appetite."
Li Huiyong, an economist at Shenwan Hongyuan Securities, said liquidity and market yields could suffer from the new rules, which stipulate that financial institutions must end the practice of providing investors with implicit guarantees against investment losses.
"The new guideline is not the last shoe to drop, or the last piece of bad news," Li said. "The era of tough financial supervision has just begun."
But the market's knee-jerk reaction to the new rules didn't seem to bother bigger investors who see long-term value in China's stock market.
Zizheng Wang, portfolio manager at UBS Asset Management, said in a statement on Monday that from a long-term perspective, the money manager "sees sustainable growth in the Chinese economy and opportunities in the A-share market."
Wang, who will manage a newly-launched onshore China equity fund for UBS AM, said he sees "attractive investment opportunities" in "fairly valued" Chinese blue-chip stocks, as well as industry leaders with growing international competitiveness.
Most sectors fell on Monday, with big losses seen in the real estate and financial stocks, which will bear the brunt of the new rules.
China's famed liquor maker Kweichou Moutai extended Friday's losses, dropping over 3 percent, as more investors took profits from the high-flying stock.
Hong Kong stocks slipped slightly, in line with other Asian markets, pressured by a retreat on Wall Street amid tax reform uncertainty.
The Hang Seng index dropped 0.2 percent to 29,151.10, while the Hong Kong China Enterprises Index lost 0.8 percent, to 11,510.87.
(Reporting by Samuel Shen and John Ruwitch; Editing by Kim Coghill)