* HSI -0.5 pct, H-shares -0.1 pct, CSI300 +0.9 pct
* HSI bounces off 200-day moving average, seen critical support
* Turnover improves, but still below average in past month
* Jiangxi Copper, Zijin Mining cut losses as metal prices bounce
By Clement Tan
HONG KONG, April 16 (Reuters) - China shares posted their first gain in three days, after earlier testing their lowest in nearly 4 months, as strength in Chinese insurers and property developers outweighed weakness in commodities counters amid a rout in physical prices.
Hong Kong markets had a third-straight daily loss, but a bout of short covering in afternoon trade on the back of a rebound in gold and oil prices limited losses on the day. Turnover was highest since April 5, but still below average.
The Hang Seng Index closed down 0.5 percent at 21,672 points, earlier bouncing off chart support at its 200-day moving average, now at about 21,462.7. A break below this technical level could point to further losses.
The China Enterprises Index of the leading Chinese listings in Hong Kong slipped 0.1 percent. The CSI300 of the top Shanghai and Shenzhen A shares ended up 0.9 percent, while the Shanghai Composite Index rose 0.6 percent, after earlier plumbing levels struck on Dec. 25.
Both onshore Chinese indexes were down 0.6 percent at the midday break. Still, Shanghai volume was some 12 percent below average despite being the highest in almost a week.
"It's a sell-off in Hong Kong, but not quite a panic," said Jackson Wong, Tanrich Securities' vice-president for equity sales. "There're actually some funds rotating into non-commodities sectors after losses in the last few days."
China Pacific Insurance (CPIC) jumped 3.4 percent in Hong Kong and 4.3 percent in Shanghai after reporting robust March premiums, lifting the Chinese insurance sector.
Separately, the country's insurance regulator said it would allow shareholders to own stakes of up to 51 percent, from the previous 20 percent in a move that will help boost capital strength.
Chinese property shares extended gains after Monday's underwhelming data for first quarter GDP growth eased some concerns about property tightening. March home price data is due on April 18.
Further buoying sentiment, a front-page editorial in the official China Securities Journal on Tuesday said the central government should fine tune policy adjustments in response to slowing economic growth but should be cautious about using interest rates and or exchange rate tools.
China Vanke spiked 5.5 percent in Shenzhen to its highest since March 1, when the market first reacted to the central government's announcement of guidelines for new curbs on housing prices.
In Hong Kong, China Overseas Land rose 0.9 percent, while smaller sector players had the bigger percentage gains, with Greentown China jumping 5.4 percent.
Chinese building materials producers were also strong. Anhui Conch Cement rose 2.4 percent in Hong Kong and 1.7 percent in Shanghai as cement prices in the mainland continued to rise and inventories dropped to a four-month low, according to Nomura.
The sell-off in physical commodities continued on Tuesday, although gold rebounded more than 1 percent after falling to two-year lows and Brent crude cut losses, giving stock markets some respite.
Jiangxi Copper was down 4.3 percent at midday, but ended down 1.9 percent in Hong Kong. Its Shanghai listing ended down 0.7 percent as Shanghai copper prices fell to an 18-month trough.
Zijin Mining fell 1.7 percent in Hong Kong and 1.3 percent in Shanghai. This is Zijin's fourth-straight daily loss and China's biggest gold miner has now lost 11 percent in Hong Kong and 8 percent in Shanghai in that time.
Chinese oil majors were broadly weaker as CNOOC Ltd slid 1.9 percent to its lowest since June.
But Chinese airlines jumped on hopes that declining oil prices will improve profit margins. China Eastern Airlines climbed 4.2 percent to recover Monday's losses in full in Hong Kong, while rising 3.6 percent in Shanghai.