* CSI300 -0.5 pct; SSEC unchanged; HSI +0.4 pct
* Market circumspect foreign investors can short sell China shares
* HSBC PMI data points to uncertain economic outlook
By Samuel Shen and Pete Sweeney
SHANGHAI, Feb 25 (Reuters) - China share markets held a soft tone on Wednesday as trading resumed after a week-long holiday, with some investors taking profits after an extended pre-holiday rally.
Analysts said that investors had shrugged off the positive surprise from industrial activity data on Wednesday morning and sold on disappointment that the central bank had not further eased interest rates over the holiday break.
"After seven consecutive (trading) days of index gains, the market is cautious after a long holiday given no fresh easing policies were announced," said Shen Zhengyang, Shanghai-based analyst at Northeast Securities.
"There's mounting uncertainty, and controversy, over when stimulus policies would be announced and how effective they would be."
The CSI300 index fell 0.5 percent to 3,504.74 points at the end of the morning session, led by financial stocks.
But Shenzhen's ChiNext index, which tracks China's Nasdaq-style board of high-growth companies, hit a record high, signalling a potential migration by retail investors back into the small-cap shares they have historically preferred to trade.
The Shanghai Composite Index was flat, while the Hang Seng index gained 0.4 percent, to 24,856.41.
Activity in China's mammoth factory sector edged up to a four-month high in February but export orders shrank at their fastest rate in 20 months, Wednesday's flash HSBC/Markit Purchasing Managers' Index (PMI) showed.
In response to the survey results, HSBC China Chief Economist Qu Hongbin forecast that China's economic activity will remain sluggish, and more policy easing is still warranted.
Regulators announced that foreign investors will be able to short-sell select mainland shares via the Hong Kong-Shanghai trading link from next week.
Although initially volume is expected to be small, short-selling, which allows investors to sell borrowed stocks to profit if prices fall, would put pressure on mainland shares, which generally trade at a premium to their Hong Kong peers.
The index measuring price differences between dual-listed companies in Shanghai and Hong Kong stood at around 120 on Wednesday morning, meaning Shanghai-traded stocks are 20 percent more expensive on average.
New A-share account openings bit.ly/1wvJ9S9
China trading volumes hit records in 2014 link.reuters.com/vag73w
Editing by Jacqueline Wong