SHANGHAI, July 22 (Reuters) - China stocks closed mixed on Wednesday, with volatility easing as investor sentiment calmed following the market's two-week-old rebound from an earlier collapse.
The key Shanghai Composite Index gained 0.2 percent, to 4,026.05 points, up for the fifth consecutive session.
But the CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 0.2 percent, to 4,157.16
There were signs of growing investor caution, as the Shanghai index has bounced nearly 20 percent from a seven-year low hit on July 9, and is approaching 4,500 points - widely seen both as a government bailout target, and a near-term ceiling.
"The stock market is still fragile, and the index level is not the only criteria to assess health of the market," said Zhu Haibin, economist at JP Morgan in Beijing.
He added that the government needs to study market conditions carefully before they start withdrawing from the bailout.
With the market stabilising, investors have returned their focus to economic conditions, and corporate profit growth.
Giving a reminder that China's economy has yet to find its feet, the Ministry of Industry and Information Technology warned on Wednesday that industry still faces significant downward pressure and firms in some industries were facing increasing difficulties in making profits.
Shenzhen's start-up board ChiNext rose 1 percent, while technology and telecommunications shares were also generally firmer.
But banking stocks remained weak.
Shares of Chinese telecom equipment maker ZTE Corp rose 3.3 percent in Shenzhen, after reporting a 43 percent jump in first-half preliminary net profit.
Shanghai Feilo Acoustics shares gained 2.7 percent after the company made a non-binding offer to acquire the lamps business of Germany's Osram. (Reporting by Samuel Shen and Pete Sweeney; Additional reporting by Winni Zhou; Editing by Jacqueline Wong)