China stocks close at highest level since 2021 on upbeat trade data

HONG KONG, Aug 7 (Reuters) - China stocks rose for a fourth straight day to close at a 3-1/2-year high on Thursday, as upbeat export data added fuel to the recent market rally despite renewed U.S. tariff threats.

The Shanghai Composite index .SSEC climbed 0.2% to 3,639.67, the highest such close since December 2021. The blue-chip CSI300 index .CSI300 was little changed.

China's exports beat forecasts in July with outbound shipments up 7.2% year-on-year, customs data showed, as manufacturers made the most of a tariff truce with the United States.

Markets largely looked past U.S. President Donald Trump's comments on Wednesday that he could announce further tariffs on China similar to the additional 25% duty imposed on imports of Indian goods over its Russian oil purchases, depending on what happens.

Investors remain focused on an August 12 deadline to see if Beijing and Washington will reach a durable tariff agreement.

"The upward trend is still intact," analysts at Pacific Securities said in a note, adding markets remain optimistic about U.S.-China trade talks while technical indicators continue to show bullish momentum.

Leading onshore gains on Thursday, the rare earth sector .CSI930598 rallied 3.2% to near a three-year high. The energy sector .CSIEN added 0.8% and banking index .CSI399986 gained 0.4%.

The semiconductor sector .CSI931865 gave up initial gains to close largely flat after Trump said the U.S. could levy a 100% tariff on some chip imports.

In Hong Kong, the benchmark Hang Seng Index .HSI reversed earlier losses with a 0.7% gain, and the tech index .HSTECH added 0.3%.

Local developers .HSNP jumped 2.5% as New World Development < 0017.HK> surged as much as 20% on a report of talks that could potentially take it private.