SHANGHAI, May 20 (Reuters) - China stocks closed higher on Friday after Chinese banks cut the benchmark reference rate for mortgages by an unexpectedly wide margin, to revive the ailing housing sector and to prop up a slowing economy hit by severe COVID-19 outbreaks.

The blue-chip CSI300 index rose 2.0% to 4,077.60, while the Shanghai Composite Index gained 1.6% to 3,146.57 points.

The Hang Seng index rose 3.0% to 20,717.24, while the China Enterprises Index gained 3.2% to 7,121.18 points.

** For the week, the CSI300 index added 2.2%, the biggest weekly gain since April 1. The Hang Seng Index logged the biggest weekly jump in two months, up 4.1%.

** The five-year loan prime rate (LPR) was lowered by 15 basis points to 4.45% from 4.60%, while the one-year LPR was unchanged at 3.70%.

** The central bank on Sunday reduced the lower limit of interest rates on home loans by 20 basis points, based on the corresponding tenor of benchmark Loan Prime Rates (LPRs), for purchases of first homes.

** "The intent and message from these two consecutive policy moves are very clear: Beijing wants to rescue the property markets," Nomura analysts said in a note.

** Nomura analysts led by Lu Ting added that the impact would likely be limited, as the mortgage rate cut is small compared with previous downcycles, while mortgage rates had already started to decline even before the recent policy moves.

** Foreign investors were net buyers of A-shares, with Refinitiv data showing inflows of 18.2 billion yuan ($2.73 billion) through Stock Connect, the largest daily inflow since Dec 9, 2021.,

** Slightly denting sentiment, Shanghai reported three new cases of COVID-19 outside quarantined areas for Thursday, after five days of no such cases.

** "There will likely be more rate cuts to come in the next few months," said Zhiwei Zhang, chief economist at Pinpoint Asset Management. He also expected more measures on fiscal policy, property and the platform economy.

** Real estate developers dropped 1.4% following the rate cut, after a 2.3% jump in the previous session. Coal miners, liquor makers and transport companies jumped at least 4% each.

** U.S. President Joe Biden may talk with his Chinese counterpart Xi Jinping in the coming weeks, national security adviser Jake Sullivan said on Thursday.

** Tech majors listed in Hong Kong surged 4.7%, with e-commerce company Alibaba up 5.6%, giving the biggest boost to the Hang Seng benchmark.

** Healthcare firms climbed 4.8% and financials stocks were up 2.5%. Wuxi Biologics climbed nearly 8% to become the biggest percentage gainer in the Hang Seng Index. (Reporting by Shanghai Newsroom; Editing by Uttaresh.V and Edmund Klamann)