China A-shares end morning higher as property developers rebound - UPDATE.

(From AFX Europe (Focus))

SHANGHAI (XFN-ASIA) - China A-shares ended the morning higher, reversing early losses, as property developers rallied on bargain-hunting, dealers said.

Banks turned mostly higher after slumping on Friday, while steel makers underperformed on worries about demand.

Home appliance makers were in demand. The commerce and finance ministries announced yesterday that a program to subsidize rural appliance purchases will be extended nationwide starting in February.

The benchmark Shanghai Composite Index ended the morning up 8.87 points or 0.47 pct at 1,880.03 after falling below its 30-day moving average of around 1,855 points.

"The market's decline was capped as the key index rebounded from the 30-day moving average level," said Chen Jinren, an analyst with Huatai Securities, "We expect the market to continue in a narrow range as investors, fund managers in particular, are still beset by worries about the rapid slowdown in economic growth."

Adding to a string of poor economic data, CLSA said today that the China purchasing manufacturers' index fell to a new record low of 40.9 in November as a result of further falls in output, new business and employment as export orders weakened.