China's key stock index closed up 0.1 percent, supported by a key technical level and better-than-expected earnings from two banks.

The strong bank earnings helped offset downward pressure from fresh signs of a further clampdown on lending. The official Securities Journal reported that the People's Bank of China had cut its 2011 lending target for banks by 10 percent from last year.

The benchmark Shanghai Composite Index .SSEC finished at 2,709 points and appears to have found temporary support at the crucial 2,700-point level after tumbling 3 percent to a three-month low on Monday.

Two mid-sized lenders, Industrial Bank (601166.SS) and China Everbright Bank (601818.SS), said their net profits grew 39.5 percent and 65.88 percent, respectively, in 2010.

Turnover of Shanghai A shares dropped to only 67 billion yuan ($10 billion) from an already low 104 billion yuan on Monday. ($1 = 6.6 yuan)