HONG KONG, Jan 11 (Reuters) - Hong Kong stocks rose to another six-month high on hopes of a strong economic rebound from the COVID-19 pandemic and discounted values.

Shares in mainland China lost momentum in the afternoon and closed lower, as investors looked for fresh cues for direction after the strong rally.

** China's blue-chip CSI 300 index dropped 0.19%, while the Shanghai Composite Index declined 0.24%.

** Hang Seng Index rose 0.49% and Hang Seng China Enterprises Index went up 0.65%.

** Local production of the anti-viral COVID drug should be able to start soon, a Chinese health expert said on Wednesday.

** Meanwhile, Chinese banks extended 1.4 trillion yuan ($206.7 billion) in new yuan loans in December, up from November and beating analysts' expectations, according to data released by the People's Bank of China.

** China's central bank and top banking regulator also said they will increase financial backing for the domestic demand and supply system to support the economy, while ensuring steady and orderly financing to the property sector.

** China markets have one of the best starts for years in January with Hang Seng Index jumping 8.4% so far this year, while Shanghai Composite Index up 2.4%, as investors cheer for the country dropping its zero-COVID policy and moving to refocus on economy.

** Investors believe the valuation is still attractive.

** "It has been two years of China being in a very bad market, underperforming not just global markets, but also Asia-Pacific markets," Nicholas Yeo, head of China equities at abrdn, told reporters at an outlook briefing.

** "There is still a lot of room for valuation to return to more normal level. We are currently looking at valuation that is probably around 30-35% discount to the 15 year-average."

** Coal stocks, Insurance companies and property developers rose 4.3%, 2.2% and 1.8% respectively, led the gains, while tourism stocks dropped 1.7%.

** In Hong Kong, tech giants ended down 0.25%. Alibaba jumped 3.1% after the company has signed a cooperation agreement with the government of Hangzhou Tuesday. Meituan dipped 2.5%. (Reporting by Summer Zhen; Editing by Uttaresh.V and Nivedita Bhattacharjee)