China's mainland indices suffered their worst one-day fall in nearly three months as China announced its GDP growth eased to 11.5% in the third quarter vs. a record 12% in the second quarter of 2007.

Beijing also announced that inflation rose by 4.1% over the same period last year, climbing 20 basis points from the January to August period.

The Shanghai Composite -- the mainland's benchmark index -- plunged 280 points, or 4.8%, on the news, to 5,562.39 points.

Investors in other Asian markets were relaxed however, with most other indices gaining. In neighboring Hong Kong, the Hang Seng rose 520 points, or 1.78%, to 29,854 points, on expectation of a potential

Federal Reserve

rate cut.

"The growth

in China is still tremendous although very, very, high," says Peter Haimes, investment director at Aberdeen Asset Management in Singapore. "When you have over 10% growth it's insignificant unless you see a sharp slowdown, and that doesn't seem to me to be happening "

The market gains in Hong Kong vs. the mainland Chinese losses continue the end of last week's trend, when dual-listed companies saw diverging performances on both exchanges.

While shares in

China Life Insurance

(LFC) - Get Report

tumbled 2.45% in Shanghai, to 69.22 yuan, in Hong Kong they lost just 0.5%, to HK$51.20.


Aluminum Corp of China

(ACH) - Get Report

plummeted 5.6% in Shanghai, to 47.10 yuan, while in Hong Kong the stock lost 2.8%, to HK$22.90.

The lagging Chinese mainland performance may be bad news for


(PTR) - Get Report

, which is now set to IPO on Nov. 5, with shares to retail investors available from tomorrow. Still, many say the IPO price, at 15 to 16.0 yuan per share, is too cheap, and that the company may fetch up to 68.8 billion yuan, or $9.2 billion.

PetroChina today unveiled plans to build China's second east-to-west pipeline, which will open in 2010. The company said the project will cost 102 billion yuan, or $13.6 billion. PetroChina shares ended the Hong Kong trading day down 1.3%, to HK$19.14.

Hong Kong real estate companies fared among the best overall, with

Sun Hung Kai

( SUHJH) surging 8.4%, to HK$147.70,

Cheung Kong


rising 7.14% to HK$138.10, and

Hutchison Whampoa


up 0.7%, to HK$85.80, on hopes of a rate cut in the U.S.

That would mean a cut in Hong Kong rates, as a result of the "peg", and would also mean good news for

iShares Hong Kong

(EWH) - Get Report

, which is invested nearly 25% in these three companies.

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China Unicom

(CHU) - Get Report


China Mobile

(CHL) - Get Report

traded up, by 2.53% and 1.93%, to HK$16.20, and HK$152.90, respectively.

In Korea, the Kospi staged a 2.24% rally, up 43 points, to 1.976 points.


(PKX) - Get Report

jumped for the third day running this week, by 4.16%, to 651,000 won. This week, the steelmaker has jumped 12.2%, after Warren Buffet expressed interest in what many in Asia say is a deeply undervalued stock. Today, the company said CFO Lee Dong-Hee is meeting Buffett later this week.

Korea is seen by many in Asia as one of the few places where companies still offer fair value, and is becoming popular amongst Chinese bargain-hunters.

In Japan, the Nikkei 225 ended the day down 74 points, or 0.45%, to 16,284.17, while the Topix also fell, by 15.79 points, or 1%, to 1548.07. The yen was slightly weaker at the end of Asia trading, to 114.44 vs. dollar, from 114.39 vs. dollar.

Mitsubishi UFJ


lost 1.92%, to 1,018 yen, spurred by yesterday's $7.9 billion writedown by

Merrill Lynch

( MER).

In India, the BSE Sensex rose 257 points, or 1.39%, to 18,770 points, lifted by

Icici Bank

(IBN) - Get Report

, which gained 4.4%, to 1,146 rupees, and


( HBD), up 2.28%, to 1,541 rupees.

Aberdeen's Haimes says that Indian technology is still relatively cheap, since valuations have been kept down by concerns over a weakening U.S. economy, and a strong rupee. Two examples being


(INFY) - Get Report



(WIT) - Get Report

, which have failed to stage a significant comeback since last week's 9% plunge.

Haimes also says that while there is a significant bull market in Asia, only a selected number of companies are consistently generating returns for investors, and that it's best to identify pockets of value.

"What you've got at the moment is that markets have gone up a lot but the stocks that are performing strongly are still a relatively narrow part of the market," he says. "There's a wide dispersion of valuations."

Daniel M. Harrison is a business journalist specialising in European and emerging markets, in particular Asia. He has an MBA from BI, Norway and a blog at

. He lives in New York.