China stocks rose on Monday supported by healthcare shares and the launch of cross-border investment scheme ETF Connect, while Hong Kong shares slipped weighed by airline operators.

** China's blue-chip index CSI300 rose 0.7% and the Shanghai Composite index gained 0.5%. In Hong Kong, the benchmark Hang Seng index dipped 0.1%.

** Investors in China and Hong Kong started trading exchange-traded funds (ETFs) in each other's markets on Monday, but more money will likely flow into mainland markets initially under ETF Connect.

** With just four Hong Kong-listed ETFs qualified, compared with 83 eligible products traded in Shanghai and Shenzhen, the benefits are sharply skewed toward funds that invest in China-listed shares.

** An index tracking China's healthcare stocks surged 4.7% on signs of a possible flare-up in COVID-19 outbreaks in China.

** Parts of eastern China are running fresh rounds of mass COVID-19 testing, as the country faces new waves of infections while recovering from impact of the spring outbreaks that hit Beijing and Shanghai.

** Daily numbers of locally transmitted infections in mainland China increased to more than 300 over the weekend, compared with a few dozens in late-June.

** Tourism and transport stocks shares fell.

** China's "Big Three" state airlines tumbled in both China and Hong Kong, after they pledged on Friday to buy a total of almost 300 Airbus jets, the biggest order by Chinese carriers since the start of the pandemic.

** Hong Kong shares of Air China slumped 4.1%, their worst day in roughly two months.

** Shares of China Southern Airlines and China Eastern Airlines also fell.

** Hong Kong shares of Great Wall Motor Co Ltd slumped 6%, after General Motors said on Friday it had called off the sale of a shuttered Indian plant to the Chinese automaker. (Reporting by Shanghai Newsroom; Editing by Amy Caren Daniel)