* HSI retreats 1.3 percent to five-week low
* Shanghai Composite down 1 pct, tests support at 2,900
* Investors continue to dump energy, materials plays
* China Resources Power up 10 pct in 3 sessions (Updates to midday)
By Vikram Subhedar and Clement Tan
HONG KONG, May 4 (Reuters) - Hong Kong and China shares traded lower on Tuesday morning, led by persistent weakness in energy and materials counters and putting benchmark indexes at risk of slipping below key support levels.
Hong Kong's Hang Seng Index was down 1.26 percent at 23,335.35 at the midday trading break. The Shanghai Composite Index was down 1 percent.
Losses were led by cyclical sectors such as oil and coal producers, and metals and mining companies as precious metals and crude oil prices declined as the U.S. dollar rose.[ID:nL3E7G4035]
Utilities extended gains for a third session in Hong Kong. China Resources Power Holdings Co Ltd led the charge, rising 2.5 percent on nearly twice its average 30-day volume as impending power shortages in China over the summer raise expectations of strong demand and possible tariff hikes.
An absence of support from other heavyweight sectors such as financials sent the Hang Seng Index through near-term support levels, and a slew of placements and new listing announced in recent weeks weighed it down further.
"One thing to watch is these placements. It looked as though every time companies saw a jump in share prices, they'd rush to get a placement done," said a trader at a Japanese brokerage in Hong Kong. "Add the long list of IPO's in Hong Kong, that's going to keep people away."
Commodities trader Glencore International AG is the latest in a series of large companies looking to raise money in Hong Kong. Sources told Reuters that the company had set a price range of 480 to 580 pence per share for the IPO, valuing it at $48-58 billion. [ID:nL3E7G407X]
Shares of Citic Resources Holdings Ltd slid 9.1 percent after the company said it planned to raise HK$2.5 billion ($321.3 million) by way of a rights issue. [ID:nL3E7G34Q8]
Caution over a heavy supply of shares coming to the market sent the Hang Seng Index below its 50-day moving average at 23,418.8, as well as its 100-day moving average at 23,442, a sign that traders consider bearish.
The index now has support at around the 23,290 level, which represents the 50 percent retracement level of the entire rally from the March low following the Japan earthquake to the 2011 high of 24,468.6 hit on April 8.
CHINA LOWER AS FUNDS WARY
Energy stocks led a broad decline in mainland China as declining oil prices gave investors a reason to sell in a market bereft of positive cues.
Brent crude fell below $122 per barrel on Wednesday, poised to record a third straight loss after government data showed U.S. crude stocks rose sharply last week and a broader pullback in commodities markets discouraged risk-taking. [ID:nL3E7G404C]
The Shanghai energy sub-index underperformed the broader market, losing 2.9 percent compared with a 1 percent fall to 2,904.3 by the Shanghai Composite Index .
PetroChina Co Ltd and China Shenhua Energy Co Ltd weighed heaviest on the benchmark, down 1.5 and 3.7 percent, respectively. China Petroleum & Chemical Corp (Sinopec) was down 0.7 percent.
"Falling oil prices are affecting oil shares today, dragging along other energy issues," said Haitong Securities analyst Zhang Qi.
Funds were unwilling to enter the market in a big way after the index tried and failed to rise above the 3,000 level, Zhang said.
Turnover has remained thin for the last 10 sessions, hitting a 12-week low on Friday. (Editing by Chris Lewis)