China, Hong Kong stocks flat as soft data offsets tariff truce lift

SHANGHAI, May 19 (Reuters) - China and Hong Kong stocks ended roughly flat on Monday as weak data on China industrial and retail sales highlighted ongoing economic challenges, although the Sino-U.S. tariff reprieve continued to lift shares of port operators.

China's blue-chip CSI300 Index .CSI300 dipped 0.3%, while the Shanghai Composite Index .SSEC was barely changed. Hong Kong's benchmark Hang Seng .HSI was little moved.

China and Hong Kong markets have recovered ground lost since Donald Trump's tariff announcement in early April, after Beijing and Washington later agreed a 90-day tariff pause last week. But the rally appears to be losing steam.

Official data showed on Monday that growth in China's industrial output and retail sales slowed in April, curbing risk appetite.

Guosheng Securities cautioned investors against chasing stocks "before concrete evidence points to a better-than-expected economy."

"Fluctuation within a wide range remains our base case scenario," the brokerage wrote.

But shares of Chinese port operators continued to surge, as investors doubled down on bets that the 90-day tariff pause will spur a rush in shipments.

Lianyungang Port 601008.SS, Ningbo Port 601018.SS and Zhuhai Port 000507.SZ all hit their daily upward limit of 10%. Shares of other major port operators such as China Merchants Port Group 001872.SZ and Shanghai International Port 600018.SS also rose sharply.

"Exporters may continue to boost production and delivery in the next few months in case tariffs are hiked again down the road," said Zhiwei Zhang, president at Pinpoint Asset Management.

China Securities Co analysts said the tariff reprieve may "spur a shipment rush that leads to a burst of businesses" for port operators.

Hong Kong-listed shares of Midea Group 0300.HK and ZTO Express 2057.HK jumped after the Hang Seng Indexes Co said they would be added to the Hang Seng Index early next month.

Shares of China Literature 0772.HK plunged 8%, on announcement it would be removed from the Hang Seng Tech Index .HSTECH.