China shares have best day in weeks, Hong Kong tepid ahead of holiday
* HSI +0.2 pct, H-shares -0.6 pct, CSI300 +1.8 pct
* HK shut on Friday for holiday, reopens on Monday
* HK indexes post first weekly loss in a month
* Tencent at record close after strong Q1 triggered upgrades
* Weak Q1 tips Parkson Retail to lowest close since January 2006
By Clement Tan
HONG KONG, May 16 (Reuters) - China shares posted their best daily gain in weeks on Thursday, limiting losses in the Hong Kong market, as investors chased a rebound in the property and financial sectors and extended a rally in technology-related counters.
Earnings drove some of the most significant moves. Tencent Holdings closed at a record high after posting robust quarterly earnings, while Parkson Group sank to its lowest in more than seven years after a weak first quarter.
The CSI300 of the leading Shanghai and Shenzhen A-share listings ended up 1.8 percent in its best percentage gain since April 24. The Shanghai Composite Index .SSEC rose 1.2 percent, its best day since May 3.
The Hang Seng Index inched up 0.2 percent, while the China Enterprises Index of the top Chinese listings in Hong Kong shed 0.6 percent. With Hong Kong markets shut on Friday for a public holiday, they snapped a three-week winning streak, down 0.8 and 2.4 percent, respectively.
"It's still very much a waiting game where China policy is concerned, because the new leadership needs time to stamp its authority and set its own direction," said Larry Jiang, chief investment strategist at Guotai Junan International Securities.
"But it's inconceivable that Japan and U.S. stocks will continue to rise while ignoring China," Jiang added. At $7.8 billion, Hong Kong turnover on Thursday was its best since May 8, but is still some way off peaks seen in the first quarter.
Chinese property stocks listed in the mainland were stronger, buoyed by a report in the official Shanghai Securities News that regulators have eased some restrictions on the refinancing of firms with some investment in real estate.
China Vanke jumped 5.1 percent in Shenzhen in its first gain in four days. Poly Real Estate rose 4.3 percent in Shanghai after closing on Wednesday at its lowest since April 12.
There was also some respite for Ping An Insurance , rising 3 percent in Shanghai after closing on Wednesday at its lowest since early December. Its Hong Kong listing fell 1.1 percent.
It is still down 3 percent on the week in Shanghai, roiled earlier this week by a temporary underwriting ban for its brokerage unit and a dispute between Shanghai Jahwa and Ping An's trust unit, which owns a stake in the Chinese cosmetics maker.
China's foreign exchange regulator said on Thursday it granted a net $137 million in new investment quotas to overseas institutions in April, the smallest monthly amount since September 2011.
Tencent Holdings soared 6.5 percent in its best day in 28 months after posting a 37 percent rise in first quarter profit that was broadly in line with market estimates, while tripling the number of active users for its mobile chat application.
Its Hong Kong shares were also helped by a slew of price target upgrades by several major brokerages. Bank of America-Merrill Lynch upgraded its target price by almost 10 percent on higher estimates of its games, e-commerce and mobile business.
On the other hand, Parkson Retail Group sank 8.5 percent to their lowest closing level since late January 2006 as investors punished its worsening operating leverage after same store sales growth declined 2 percent in the first quarter, while rental expenses jumped 31 percent.
Deutsche Bank analysts cut their price target for Parkson's Hong Kong listing by 23 percent, expecting negative operating leverage to linger into the third quarter this year after the company management cut its 2013 growth targets.