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Hong Kong stocks rose 0.31 percent Tuesday in the first day's trading after a long holiday weekend, although gains were capped by below-forecast manufacturing data from China and the United States.
The benchmark Hang Seng Index added 68.19 points to end at 22,367.82 on turnover of HK$60.16 billion ($7.76 billion).
In the United States the Institute for Supply Management said its manufacturing index fell to 51.3 in March from 54.2 in February. While anything above 50 points to expansion, the figure reflected slower growth in most of the sectors surveyed.
That news came hours after China's official purchasing managers' index (PMI) hit 50.9 in March, the highest since April 2012 but below expectations of 51.0.
Chinese banks were hit after the China Banking Regulatory Commission tightened wealth management product rules.
Minsheng Bank fell 4.1 percent to HK$9.48, extending a 7.9 percent loss, while Citic Bank shed 6.0 percent to HK$4.38, following a 4.1 percent dive last Thursday.
However, property stocks rose on bargain-buying after recent losses fuelled by government measures aimed at capping rising prices.
Sun Hung Kai Properties, Hong Kong's largest developer by market capitalisation, rose 1.7 percent to HK$106.40 and China Overseas Land, the largest Hong-Kong listed Mainland developer, rose 0.9 percent to HK$21.60.
Chinese shares closed down 0.30 percent. The benchmark Shanghai Composite Index fell 6.66 points to 2,227.74 -- its lowest since December 27 -- on turnover of 77.6 billion yuan ($12.5 billion).
Investors are trading cautiously as they await the release of key statistics -- including gross domestic product for the first quarter -- later this month to gauge the health of the domestic economy, dealers said.
"The PMI data showed a weaker-than-expected recovery in the domestic economy, so investors might take a wait-and-see approach before other indicators come out," Haitong Securities analyst Zhang Qi told AFP.
Medical shares fell after reports cited an expert saying it will take some time for drug makers to produce a vaccine for latest strain of bird flu, which the government said at the weekend killed two men in Shanghai.
Tonghua Dongbao Pharmaceutical slumped 8.25 percent to 13.01 yuan while Tianjin Zhongxin Pharmaceutical dropped 7.41 percent to 15.13 yuan.
Property developers bucked the trend after a survey Monday showed home prices grew last month. Poly Real Estate rose 1.44 percent to 11.99 yuan and Gemdale gained 1.21 percent to 6.68 yuan.
Banking stocks were mixed, with China Citic Bank falling 2.61 percent to 4.48 yuan and China Construction Bank rising 1.31 percent to 4.64 yuan.
-- Dow Jones Newswires contributed to this story --