China shares eked out a gain on Thursday, thanks to solid gains by property developers on a day when Hong Kong and mainland indices faced chart resistance and Chinese inflation data discouraged some investors.

The Shanghai Composite Index ended up 0.1 percent to 2,349.6 after briefly testing its 100-day moving average at about 2,360.2 in the highest A-share turnover since Jan. 10.

The Hang Seng Index finished down 0.04 percent at 21,010 points in Hong Kong's highest turnover since Dec. 1.

Shortly after markets opened, Beijing announced annual inflation in January had risen to 4.5 percent, higher than the 4.1 percent expectation of analysts polled by Reuters.

The higher-than-expected inflation should delay any cut in bank reserve requirements, Hong Hao, a Beijing-based CICC global strategist, told Reuters.

Not surprisingly, shares of Chinese banks fell. In Hong Kong, Industrial and Commercial Bank of China (ICBC) lost 0.9 percent, while China Construction Bank (CCB) dropped 0.6 percent.

Reuters reported on Thursday that the People's Bank of China (PBOC) appears to be waiting for coordinated liquidity action from global central banks, possibly in late February, before moving to cut bank reserve requirements.

Housing inflation declined in January, which was taken by some in the China market to signal that aggressive government policies to curb housing prices will be relaxed. So property shares got a second boost this week. On Tuesday, they rose when Beijing moved to support first-time home buyers.

The property gains helped limit losses in Hong Kong, where the index briefly tested its 250-day moving average, a level it has not finished above since July 7. The average is currently at about 21,023.

PROPERTY LIFTS MAINLAND RISK SENTIMENT

In Hong Kong, China Resources Land Ltd jumped 5.7 percent in more than three times its 30-day average volume to end at the highest since Aug. 2 last year.

The Shanghai property sub-index rose 1 percent, with Poly Real Estate up 1.3 percent. Shenzhen-listed China Vanke gained 1.5 percent in strong volume.

Risk appetite among mainland investors also improved more broadly, with the CSI500 Index, a gauge for small- and medium-sized listings in the mainland, jumping 0.7 percent.

At the aggregate level, the (mainland) A-share market is not driven by fundamentals. Rather, this is a market driven almost completely by sentiment, UBS economist Jonathan Anderson wrote in a note dated Feb. 9.

As a result, swings in fund flows and valuations absolutely overwhelm underlying trends like earnings. And not just in the short term... but over every time frame, he added.

Trading in shares of Alibaba.com Ltd was halted in Hong Kong on Thursday pending an announcement regarding its parent, Chinese e-commerce giant Alibaba Group, which is reported to be planning to buy back the 40 percent stake in it held by Yahoo Inc.