SHANGHAI: China stocks rose on Tuesday as a series of government support measures and improving economic data revived investors' appetite for riskier assets, though thin trading volume indicated that confidence remains fragile.

But Hong Kong shares dropped, pulled lower by the energy sector against a backdrop of slumping crude oil prices and mixed messages on the outlook for US monetary policy.

Both the CSI300 index and the Shanghai Composite Index rose 1 percent to 3,252.59 points and 3,038.57 points, respectively.

In Hong Kong, the Hang Seng index dropped 1.4 percent, while the Hong Kong China Enterprises Index lost 1.6 percent.

Beijing has unveiled a series of policies to aid China's struggling economy, including more infrastructure investment, tax reform and plans for debt-to-equity swaps.

Chinese Premier Li Keqiang said in a statement on Monday that he expects tax reforms will lower the cost of innovation and help create jobs for more than 10 million university and vocational school graduates.

Nomura said in a note that it has raised its China GDP growth forecast to 6.2 percent from 5.8 percent for 2016 and to 5.8 percent from 5.6 percent for 2017, largely due to stronger-than-expected fiscal easing and faster-than-expected property investment growth.

As a result, Nomura has scaled back its expectations of further central bank policy rate cuts to one, which it sees in the second half of the year, but maintained its forecasts for three more cuts to bank reserve requirements (RRR) this year and two more in 2017.

"Generally speaking, the market is stabilising, despite some volatility," the asset management arm of Orient Securities wrote.

The asset manager said market sentiment has been propped by positive central government policies, signs of improvement in China's March industrial data, yuan stability and recent dovish remarks from Janet Yellen, the US Federal Reserve Chair.

"However, investors still need to heed some potentially disturbing factors, including ... rising inflation concerns, which could restrict further monetary easing, as well as property curbs in first-tier cities, which would impact the pickup in real estate investment."

Banking was the only main sector that fell in China, as investors weighed the impact of potential debt-to-swap schemes.

China's first batch of debt-to-equity swaps is expected to "resolve" 1 trillion yuan ($154.38 billion) in potential bad banking debt in three years or less, Chinese media group Caixin reported on Monday.

Swapping debt into equity in a troubled borrower might get bad loans off lenders' books, but there was also a danger of simply converting bad debt into bad equity.

In Hong Kong, all main sectors fell, with an index tracking energy shares slumping nearly 3 percent.

Oil giants including Sinopec, PetroChina and CNOOC all dropped sharply after oil prices shed more than 2 percent overnight, which brought Brent to one-month lows.