China stocks rose on Wednesday and tracked global peers higher as market sentiment was buoyed by upbeat earnings from U.S. companies and rate-cut relief after data showed U.S. business activity cooled in April.

Lifting sentiment, UBS analysts forecast foreign investors to gradually return to China's market via the Stock Connect as market sentiment and macro environment improve. The bank's strategists upgraded MSCI China equities to "overweight" on Tuesday.

Asian stocks tracked Wall Street higher as an after-hours surge in U.S.-listed shares of electric vehicle maker Tesla and upbeat earnings from some U.S. companies lifted risk sentiment.

Traders also found comfort in data that signalled U.S. business activity cooled in April to a four-month low due to weaker demand, while rates of inflation eased slightly, suggesting some possible relief for the Federal Reserve.

** At the midday break, the Shanghai Composite index was up 0.33% at 3,031.96 points.

** China's blue-chip CSI300 index remained flat, with its financial sector sub-index higher by 0.11%, the consumer staples sector down 0.2%, the real estate index down 0.52% and the healthcare sub-index down 0.75%.

** Chinese H-shares listed in Hong Kong rose 1.8% to 6,061.79, while the Hang Seng Index was up 1.67% at 17,110.21.

** The smaller Shenzhen index was up 0.49%, the start-up board ChiNext Composite index was weaker by 0.1% and Shanghai's tech-focused STAR50 index was up 0.67%​.

** Around the region, MSCI's Asia ex-Japan stock index was firmer by 1.55% while Japan's Nikkei index was up 2.15%.

** The largest percentage gainers in the main Shanghai Composite index were Sichuan Tianwei Electronic Co Ltd , up 19.99%, followed by Suzhou Harmontronics Automation Technology Co Ltd, gaining 19.99% and JinGuan Electric Co Ltd, up by 12.33%.

** The top gainers among H-shares were SenseTime Group Inc , up 31.15%, followed by Li Ning Co Ltd, gaining 6.27% and Kuaishou Technology, up by 6.21%.

(Reporting by Shanghai Newsroom; Editing by Sherry Jacob-Phillips)