SHANGHAI, Sept 20 (Reuters) - China stocks closed down on Wednesday as concerns lingered about the world's second-largest economy despite last week's better-than-expected data, with foreign investor selling also weighing on market sentiment.
** The blue-chip CSI 300 Index finished 0.4% lower, and the Shanghai Composite Index declined 0.5% at close.
** Hong Kong's Hang Seng Index lost 0.6%, while the Hang Seng China Enterprises Index dropped 0.9%.
** Asian stocks struggled for headway while U.S. yields stood at or near decade highs along the curve as surging oil prices stoked inflation and set the scene for the Federal Reserve to project interest rates staying higher for longer.
** In line with market expectations, China kept benchmark lending rates unchanged at a monthly fixing.
** The decision came as recent economic data showed China's economy was finding its footing after a sharp slowdown, with both factory output and retail sales in August beating market expectations.
** However, Cong Liang, the vice chairman of the National Development and Reform Commission, said China's economy still faced a lot of difficulties and challenges.
** China will intensify macro-control efforts and strive to achieve annual economic development goals, Cong said.
** Shares in tourism, semiconductor , and automobile firms lost between 1.4% and 2% to lead the decline.
** Foreign investors sold a net 3.5 billion yuan ($479.52 million) of Chinese stocks via the Stock Connect on Wednesday.
** Tech giants listed in Hong Kong slumped 1.6%, weighing on the Hang Seng benchmark.
** "With Asia, GEM (Global Emerging Markets) and global funds already underweight China, especially GEM funds, we believe much of the pessimism has been priced in," HSBC said in a note.
** "The good news is the market is now cheap. We also see positives from the widespread improvement in August macro data." ($1 = 7.2989 Chinese yuan) (Reporting by Shanghai Newsroom; Editing by Subhranshu Sahu and Eileen Soreng)
