HONG KONG (Nikkei Markets) -- Hong Kong shares fell on Monday, led by losses in financial stocks after China's central bank governor flagged concerns about high debt levels in the nation's financial system.

The Hang Seng Index had shed 0.6% to 28,436.67 by midday, after falling as much as 1.6% earlier on Monday. Cathay Pacific Airways slid 1.5% to 13 Hong Kong dollars ($1.67). Kingboard Chemical Holdings said the company and its units agreed to sell their 9.61% stake in Cathay Pacific to Qatar Airways for HK$5.16 billion ($661 million) in cash. The sale price of HK$13.65 apiece is a 3.4% premium to Cathay Pacific's closing price on Friday. Kingboard Chemical was up 0.7%, while Kingboard Laminates Holdings, one of its units that also sold its stake in the airline, added 0.9%.

A gauge of mainland companies listed in Hong Kong slid 1.1% on heavyweight lenders and insurers. China Construction Bank (CCB) and Industrial & Commercial Bank of China (ICBC) each lost 1.3%, while China Life Insurance fell 1.5%.

In an article published on the People's Bank of China website on Saturday, Governor Zhou Xiaochuan said risks, including hidden ones, were accumulating. The governor, who is widely expected to retire soon, called for tougher regulations to rein in high debt in Asia's largest economy. The Shanghai Composite Index was down 0.1%, while the onshore traded yuan was little changed against the U.S. dollar at 6.6330.

"Market participants are taking this warning as an excuse to push down the Hang Seng Index," said Felix Man, executive director at Future Land Resources Capital Group. "I think the main reason is that people are locking in profits earned in the past few days ahead of China Literature's listing debut."

Fund managers may cut positions instead of adding new ones as they enter November after achieving good returns in 2017, Man said.

Chinese online publishing and e-book company China Literature, majority owned by Tencent Holdings, is expected to list on Hong Kong's main board on Wednesday after pricing its 151.4 million-share IPO at the top end of its HK$48 to HK$55 per-share range. Tencent was up 0.7% by midday after falling as much as 0.9% earlier. It rose 5.8% last week.

Apple-supplier AAC Technologies Holdings jumped 4.7% after the iPhone maker surged to a record high in New York on Friday following an upbeat outlook for its latest device. Sunny Optical Technology Group, also a supplier to the Cupertino, California-based company, rose 1.9%, while Tongda Group Holdings lost 0.9%.

Energy producers PetroChina and CNOOC were among the handful of gainers on the Hang Seng Index by midday, rising 0.8% and 1.3%, respectively, after U.S. crude prices rose 2% on Friday.

Guangzhou Automobile Group slid 2.1%, trimming year-to-date gains to 102%. On Friday, the carmaker reported a 25.6% increase in auto sales for the January-October period.

Developer China Vanke slumped 2.5% after reporting a 24.9% drop in contracted sales for October.

Sunac China Holdings fell 5.3%, paring year-to-date gains to 445%. On Monday, the developer reported a 193% jump in contracted sales for October to 43.94 billion yuan ($6.62 billion).

Jingrui Holdings edged 0.5% lower. Late Friday, the developer said contracted sales for October nearly doubled from a year ago.

Media and publishing company Next Digital slumped 10.4% after saying it expects losses for the six months ended Sept. 30 to widen because of poor market sentiment and cautious spending on advertisements.

Equity markets in the rest of Asia were mixed, while the Nikkei Asia300 Index slipped 0.3%. Investors are watching the outcome of U.S. President Donald Trump's ongoing 12-day five-nation Asia tour, covering Japan, South Korea, China, Vietnam and the Philippines.

--Amy Lam