(Updates to midday)
HONG KONG/SHANGHAI, Aug 11 (Reuters) - Hong Kong and China shares posted modest gains by midday Tuesday, recovering from losses earlier in the day following weaker than expected data for July factory output and investment.
Although the below-forecast July output data disappointed, retail sales were strong and exports posted a month-on-month rise, while economists said the economic recovery was still intact despite indications it was taking a breather.
Here are the index moves and top stock moves in both markets by midday-
HONG KONG
* The benchmark Hang Seng Index was up 0.4 percent or 86.34 points at 21,015.86 after dropping to 20,733.34 earlier in the session.
* Tencent, which operates China's largest online messaging community, jumped 6.6 percent before its second-quarter earnings announcement on Wednesday.
BNP Paribas estimated a second-quarter net profit of 1.15 billion yuan ($168.3 million) at Tencent, a 13.5 percent increase from the first quarter and an 83.3 percent jump from a year earlier, on increased contributions from and improved profitability at its gaming business.
* Hong Kong Exchanges & Clearing jumped 3.9 percent to HK$152.10. The world's largest stock exchange operator by market value is expected to report a more or less flat performance in the second quarter of 2009, ending four successive quarters of shrinking earnings growth.
* The China Enterprises Index, which represents top locally listed mainland Chinese stocks, rose 0.4 percent to 11,952.84.
* Dongfeng Group, China's third-largest carmaker, continued to climb on strong sales growth data for July. The stock was up 6.5 percent at HK$8.47. China's car sales in July jumped 70.54 percent from a year earlier to 832,600 units, as Beijing's policy incentives continued to boost demand.
* Metal stocks dropped, with Jiangxi Copper shedding 2 percent as data showed China's copper imports fell 15 percent in July from record levels in June.
Angang Steel gave up 3.6 percent while smaller rival Maanshan Iron and Steel fell 4.6 percent as record high steel output data for July stoked fears of further increases in iron ore prices.
SHANGHAI
* The Shanghai Composite Index ended the morning up 0.27 percent at 3,258.396 points in shrinking volume.
* Gaining Shanghai A shares outnumbered losers by 476 to 429, while turnover for Shanghai A shares dropped to 62.6 billion yuan ($9.2 billion) from Monday morning's 77.6 billion yuan.
* "The data for July is generally in line with expectations, without a significant improvement or worsening, and the index is likely to remain in a consolidation phase," said Central Securities analyst He Weijiang.
* Shortly before the end of the morning session, the People's Bank of China said banks extended 355.9 billion yuan in new local-currency loans in July, down from 1.53 trillion yuan in June and a sharper fall than many analysts had expected, although the second half had been widely expected to bring a marked slowdown in lending.
* Analysts said sentiment was lifted somewhat by news of the approval of new funds, suggesting the government may be aiming to cushion the impact of the lending slowdown on stock market liquidity.
* Official media reported that three domestic funds had recently gained approval from regulators and would be launched soon, breaking a two-week lull in new fund approvals, while Korea Investment Trust Management obtained a licence to invest in China's securities markets under the QFII scheme.
* Property shares were firm with developer China Vanke up 1.20 percent to 12.69 yuan. Metal shares were soft with Jiangxi Coppper sliding 3.22 percent to 42.40 yuan.
* China Eastern Airlines climbed 2.33 percent to 6.14 yuan after returning to the black in the first half of 2009, while saying it it would actively push ahead with its acquisition of Shanghai Airlines in the second half. Shanghai Airlines gained 2.5 percent to 6.57 yuan.
* Two new stocks staged strong debuts in Shenzhen. Shanghai SK Petroleum Chemical Equipment soaring 104 percent from its IPO price to 32.55 yuan and Beijing Join-Cheer Software surging 122 percent to 59.84 yuan.
* Qingdao Haier jumped 4.77 percent to 15.82 yuan after saying its first-half net profit rose 21 percent. (Reporting by Parvathy Ullatil in HONG KONG and Claire Zhang in SHANGHAI; Editing by Edmund Klamann and Chris Lewis)