HONG KONG, July 2 (Reuters) - Hong Kong and China-listed stocks rose on Thursday as strong manufacturing data from the mainland cemented investor confidence in the ongoing recovery in the world's third-largest economy.
Fan Gang, an economist who advises the central bank, late on Wednesday said China's economic recovery was sustainable and exports would be grow again, from a low base, by the end of the year.
Chinese insurers jumped on Thursday after the Shanghai Composite Index breached the 3,000-point level for the first time in more than a year in the previous session, raising hopes for strong investment income at insurance companies in 2009 after last year's market meltdown.
The world's largest insurer China Life advanced 1.8 percent to HK$29 in Hong Kong, while China's second-biggest insurance company Ping An climbed 4.7 percent to 54.70 yuan in Shanghai, extending Wednesday's 5.68 percent rise. The Shanghai benchmark index has risen over 66 percent so far this year amid expectations of an early turnaround in the Chinese economy.
Here are the index moves and top stock moves in both markets by midday-
* The benchmark Hang Seng Index was up 1 percent at 18,555.64 after rising 35.4 percent in the April to June period, its best quarter in more than 15 years.
* "The resilience of China's economy has been impressive," said HSBC China strategist Steven Sun.
Sun set a year-end target of 20,000 points for the Hang Seng Index, factoring a 5 to 15 percent upside for locally-listed stocks over the next six months.
"The risk of being out of the stock market over the long run is bigger than that of being in it now," he said.
* The China Enterprises Index, which represents top locally listed mainland Chinese stocks, had risen 1.4 percent to 11,112.21.
* KWG Property dropped after it said it would sell 300 million new shares, or 10.37 percent of its enlarged share capital, to its controlling shareholder at an 8.6 percent discount to the closing price of HK$5.58 on June 29.
The company is looking to raise HK$1.5 billion to purchase land, fund construction projects and for working capital.
The stock was down 5.2 percent at HK$5.29 after trading resumed on Thursday.
* Chinese banks extended gains, with China Construction Bank up 2.2 percent and Bank of China climbing 1.1 percent ahead of June loans data, which is expected to show another month of strong new lending on the mainland.
New lending by Chinese banks was likely to hit 1.2 trillion yuan ($175.6 billion) in June, the China Securities Journal said last week, even as bank regulators warned against improper lending.
* Coal stocks rose on Thursday with power consumption for June set to show a year-on-year rise for the first time since October 2008 amid a recovering economy and hotter-than-usual weather.
China Shenhua, the world's most valuauble coal miner rose 1.6 percent, while smaller rival Yanzhou Coal added 2.3 percent.
SHANGHAI
* The Shanghai Composite Index ended the morning up 0.9 percent at 3,035.210 points, after hitting a 13-month intraday high for a fourth day in a row.
* But losing Shanghai A shares outnumbered gainers by 447 to 433, while turnover in Shanghai A shares rose to 100.3 billion yuan ($14.7 billion) from Wednesday morning's 71.4 billion yuan.
* "Investors turned cautious after the index rose above 3,000 points but signs of economic recovery could lift the index higher," said Western Securities analyst Cao Xuefeng.
He added, however, that new IPOs, including a relatively major offering by Sichuan Expressway that had just received final approval regulatory approval, would encourage profit taking as they threatened to divert funds from the rest of the market.
* Energy and metal shares led gains, with China Shenhua Energy jumping 4.49 percent to 31.85 yuan, while Sino Platinum Metals raced up by its 10 percent daily limit to 24.98 yuan.
* PetroChina, Asia's top oil and gas producer and the most heavily weighted stock in the index, advanced 2.06 percent to 14.88 yuan after the South China Morning Post reported that its parent company planned to revive a $17 billion bid for the Argentinian unit of Repsol-YPF. The stock rose 0.8 percent to HK$8.67 in Hong Kong.
* Bank of China dipped 0.43 percent to 4.61 yuan, after rising more the 3 percent the day before when Central Huijin, an arm of the country's $200 billion sovereign wealth fund, indicated it would not cut its holdings in the bank when a lock-up period on its shares expires this weekend. (Reporting by Parvathy Ullatil in HONG KONG and Claire Zhang in SHANGHAI; Editing by Chris Lewis)