* HSI +2.4 pct, H-shares +3.3 pct, CSI300 +0.1 pct
* China shares mixed as markets were calmed by PBOC comments
* Hong Kong shares have best day since Jan. 2 as investors
* China banks remain weak onshore due to lingering cash
By Yimou Lee and Donny Kwok
HONG KONG, June 26 (Reuters) - China shares ended flat in
choppy trade on Wednesday, trimming early losses as Chinese
financial markets were calmed by the central bank's pledge to
prevent any lasting credit crunch, while Hong Kong stocks turned
buoyant in the afternoon.
Hong Kong indexes had their best day in nearly six months as
investors hunted for bargains after recent market turmoil, with
China banking sectors rebounding from big hits by a cash crunch
in the mainland.
The CSI300 index of the leading Shanghai and
Shenzhen listings shed early losses and edged up 0.1 percent in
its first gain in six sessions, while the Shanghai Composite
Index fell 0.4 percent at 1,951.49 points.
Both indexes have tumbled more than 9 percent since last
Wednesday when the mainland's cash squeeze started to worsen,
and down more than 20 percent from highs in February.
The Hang Seng Index closed up 2.4 percent at
20,338.55, while the China Enterprises Index of the top
Chinese listings in Hong Kong rose 3.3 percent. Both had their
biggest daily percentage gains since Jan. 2.
The mainland and Hong Kong markets "appeared bottoming out,"
said Andrew To, director of research of Emperor Capital Group in
"As investors were covering their short positions ahead of
month-end and half-year end, the markets were poised for a
rebound," he said. "No matter if the markets' fundamentals are
good or bad, there is a time for profit-taking and time for
Shares in the "Big Four" Chinese banks reversed recent
losses and gained in both onshore and offshore markets, as the
country's short-term borrowing rates eased for a fourth day and
the People's Bank of China (PBOC) moved late on Tuesday to allay
fears of a banking crisis. Worries had driven Shanghai shares to
their lowest in nearly 4-1/2 years.
With a lift from short-covering in Hong Kong, Industrial and
Commercial Bank of China (ICBC) jumped 6.8 percent and
China Construction Bank (CCB) 6.5 percent, while in
Shanghai shares of ICBC edged up 0.5 percent and CCB
gained 0.5 percent.
STILL SOME FEARS
But fears of a credit crunch and slower loan growth
continued to fuel selling in the mainland of smaller Chinese
banks, which are more reliant on short-term interbank funding.
Alex Wong, a director at Ample Finance Group in Hong Kong,
said the PBOC's comments "did not help much to improve people's
confidence as the consequences (of tight money) are yet to be
seen amid slow (China) economy growth."
In Shanghai, China Minsheng Banking Corp fell
1.7 percent in spite of its statement on Tuesday that a Shanghai
interbank offered rate (Shibor) hike had not caused liquidity
disruption and that the management was confident about
controlling credit risks despite the slowing economy.
Growth-sensitive sectors in China, from energy to materials,
remained weak. Petro China fell 1.1 percent, while
Zijin Mining dropped 2.9 percent.
In Hong Kong, traders said China banking and property stocks
were among targets as investors went bargain-hunting. Poly
Property rose 4.1 percent, while China Overseas Land
gained 2.8 percent.
Kunlun Energy jumped 3.8 percent after Jefferies
Equity Research upgraded it to buy from underperform, citing a
shift in subsidy policy which will be positive to its vehicle