HK, China stocks gain on economic recovery signs

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. [ID:nPEK153534]

Chinese insurers jumped on Thursday after the Shanghai Composite Index .SSEC 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 (2628.HK: Quote, Profile, Research) advanced 1.8 percent to HK$29 in Hong Kong, while China's second-biggest insurance company Ping An (601318.SS: Quote, Profile, Research) 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 .HSI 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.