Hong Kong shares to ease on profit-taking, Wall St fall

HONG KONG, May 8 - Hong Kong shares are expected to open lower on Friday amid weaker market sentiment following losses on Wall Street, with investors likely to take profits after a six-day rally pushed shares to a seven-month high.

China's Geely Automobile Holdings may be in focus, after the company said it had no intention of bidding for carmakers Volvo or Saab, according to a Hong Kong stock exchange filing on Thursday.

The stock surged 13.6 percent in Hong Kong on Thursday, amid speculation it was a potential bidder for General Motors' Swedish unit Saab as well as for Ford Motors' Volvo unit.

The benchmark Hang Seng Index rose 2.28 percent on Thursday to close at a seven-month high of 17,217.89 -- its best closing level since October last year -- gaining ground for a sixth consecutive session, as optimism about U.S. bank stress-test results fuelled a sharp rally in shares of heavyweight HSBC Holdings.

STOCKS TO WATCH

* China Construction Bank Corp will be watched after Bank of America Corp said it wanted to remain a strategic partner with the Chinese lender and "always have a substantial ownership position" in the bank. Analysts have said Bank of America could post a $8 billion or larger gain from selling its 16.6 percent stake.

* Manulife Financial Corp, Canada's largest insurer, reported a larger quarterly loss on Thursday as stock market declines and credit-related impairments took a toll.

* Fashion retailer Giordano late on Thursday said it expected its results for the half year ending June 30 to be significantly lower compared with the same period last year, which will have a substantial negative impact on profit, as the global financial crisis adversely affected consumer confidence in all the company's markets. For statement please see http://www.hkexnews.hk/listedco/listconews/sehk/20090507/LTN20090507919.pdf ----------------------MARKET SNAPSHOT @ 2242 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG S&P 500 <.SPX> 907.39 -1.32% -12.140 USD/JPY <JPY=> 99.14 -0.12% -0.120 10-YR US TSY YLD <US10YT=RR> 3.3397 -- 0.000 SPOT GOLD <XAU=> 910.45 0.15% 1.400 US CRUDE <CLc1> 56.43 -0.49% -0.260 DOW JONES <.DJI> 8409.85 -1.20% -102.43 ASIA ADRS <.BKAS> 106.48 -2.21% -2.41 -------------------------------------------------------------

MARKETS SUMMARY *Tech, poor auction hits Wall St; banks up late [nN07403386] *Oil closes at 6-month high on economic optimism [nSP407747] *Treasuries dive on weak 30-yr sale, jobless fall [nN07406613] *Euro rises to 1-month high vs dollar after ECB [nN07388826]