HK shares gain 1 pct as CNOOC cheers higher oil

HONG KONG, June 6 (Reuters) - Hong Kong shares rose 1 percent on Friday on forecast-beating retail sales and jobs data from the United States and as a recovery in oil prices spurred a 3.7 percent rally in offshore oil producer CNOOC (0883.HK).

But volumes remained thin as investors were cautious about the health of the global economy, which has been pummelled by the credit crisis and soaring prices of resources in recent months.

"The momentum is still not too great. We are just following the recovery in the U.S. markets and oil prices, but in the short term the outlook for the Hong Kong markets is still cautious," said Linus Yip, strategist with First Shanghai Securities

The primary market reflected the unchanged mood among investors with yet another company, Wah Kwong Maritime Transport Holdings Ltd (0067.HK), withdrawing its initial public offering in Hong Kong due to instability in the international capital markets. In addition, the two new listings in the Hong Kong market on Friday fell below their issue price.

The Hang Seng Index .HSI ended the mroning session 243.68 points higher at 24,498.97 after opening up 1.03 percent.

The China Enterprises Index of locally listed mainland companies .HSCE rose 1.5 percent to 13,558.90, led by a rebound in coal stocks.

Yanzhou Coal (1171.HK) surged 3.7 percent, recovering from a two-day slide on worries over government-led price intervention. Analysts downplayed the impact of the temporary price cut on thermal coal in Yanzhou's home province of Shandong, saying it would cost the company only 15 million yuan. Other coal stocks joined Yanzhou, with China Shenhua (1088.HK) gaining 2.3 percent and China Coal Energy (1898.HK) up 1.5 percent.

PetroChina (0857.HK) climbed 1.7 percent, while oil refiner Sinopec Corp (0386.HK) extended Thursday's 4.4 percent rally on talk that a fire at one of its refineries could give the company an excuse to hike prices amid a supply shortage.

But higher oil prices sent airline stocks tumbling, with Cathay Pacific Airways (0293.HK) down 2.4 percent and China Southern Airlines (1055.HK) dropping 2.2 percent.

Index heavyweights China Mobile (0941.HK) and China Life (2628.HK) supported advances in the broad market. China Mobile gained 0.9 percent and China Life was up 2.1 percent.

New listing Central China (0832.HK) fell 5.5 percent to HK$2.60 from its IPO price of HK$2.75. Pou Sheng International (3813.HK), which also made its debut, was down 10.2 percent at HK$2.74 against its issue price of HK$3.05.

The world's largest bank by market capitalisation, Industrial & Commercial Bank of China (ICBC) (1398.HK) (601398.SS) gained 1.7 percent after it said on Thursday it was aiming to become the world's most profitable lender in less than five years. ICBC is already Asia's most profitable lender.

Franshion Properties (China) Ltd (0817.HK) rose 5.1 percent after it said on Friday it was buying a Chinese high-end real estate development and management firm, China Jin Mao (Group) Co Ltd, for 11 billion yuan ($1.58 billion), a deal to be settled in cash and by issue of new shares.

Fixed-line operator China Netcom (0906.HK) was back in the red after a brief respite on Thursday, down 2.2 percent as investors continued to lock in gains made in a run-up in the stock ahead of the industry revamp. China Unicom (0762.HK) was down 1.1 percent.

(US$1 =HK$7.80) (Reporting by Parvathy Ullatil; Editing by Anne Marie Roantree)