Shanghai stocks snapped a four-session losing streak on Friday but still posted their biggest weekly loss since mid-December as concerns over tighter liquidity and curbs on property investment dampened investors' risk appetite.
The blue-chip CSI300 index rose 0.6 percent to 3,456.05 points, while the Shanghai Composite Index gained 0.4 percent to 3,222.51.
For the week, the CSI was down 1 percent, while SSEC sank 1.4 percent. For the month, the CSI was down 0.1 pct, while SSEC shed 0.6 pct.
China fund managers recommend reducing equity exposure for the next three months as worries including tighter liquidity remain, even as fresh data indicated the economy is steadying and improving, a monthly Reuters poll showed.
Earlier on Friday, the central bank skipped open market operations for the sixth straight session.
For the week, the central bank drained a net 290 billion yuan ($42.08 billion), compared with a net injection of 80 billion yuan a week earlier.
The cost of borrowing short-term cash against bonds at the nation's stock exchanges more than tripled to as much as 32 percent on Thursday as smaller financial institutions scrambled for funds before a central bank health-check on the banking industry.
The property market was another area of concern as an increasing number of cities put additional curbs on home purchases to cool heated prices.
A government think tank urged authorities to guard against risks in the property and financial sectors by properly managing monetary and land supply "floodgates," adding to worries about more restrictions on property developers.
An index track the nation's major developers slid 2.5 percent for the week, its worst week in three months.
($1 = 6.8912 Chinese yuan renminbi)
(Reporting by Luoyan Liu and John Ruwitch; Editing by Kim Coghill)