HONG KONG, May 17 (Reuters) - China stocks struggled for

direction on Friday and inched lower by midday as a slew of

domestic data showed that growth prospects for the world's

second-largest economy remain challenging.

China's factory output topped forecasts in April, while

retail sales unexpectedly slowed and new home prices fell at

fastest pace in over 9 years, piling pressure on Beijing to do

more to support growth.

Meanwhile, China's finance ministry auctioned 30-year bonds

at a yield of 2.57% on Friday, as Beijing kicked off sales of

1-trillion-yuan long-term special bonds to help stimulate a

flagging economy.

Shares of some Chinese property developers rose by

midday ahead of a news briefing held by officials about policies

to ensure completion of housing projects.

Hong Kong stocks extended gains, driven by a 7% surge in

Alibaba Group ( BABA ) after U.S. regulatory filings show some

global funds, including "Big Short" investor Michael Burry,

accumulated the firm's stocks last quarter.

Hang Seng Tech Index was up 0.7%.

** At the midday break, the Shanghai Composite index was

down 0.1% at 3,119.27 points.

** China's blue-chip CSI300 index was down 0.2%, with

its financial sector sub-index higher by 0.06%, the

consumer staples sector up 0.07%, the real estate

index down 1.01% and the healthcare sub-index

down 0.85%.

** Chinese H-shares listed in Hong Kong rose 0.34% to

6,894.43, while the Hang Seng Index was up 0.29% at

19,433.14.

** The smaller Shenzhen index was down 0.1%, the

start-up board ChiNext Composite index was weaker by

0.19% and Shanghai's tech-focused STAR50 index was up

0.12%​.

** Around the region, MSCI's Asia ex-Japan stock index

was weaker by 0.34% while Japan's Nikkei index

was down 0.32%.

** The yuan was quoted at 7.2265 per U.S. dollar,

0.09% weaker than the previous close of 7.2199.