* SSEC -1.2%, CSI300 -1.6%, HSI -1.0% * HK->Shanghai Connect daily quota used -3.2%, Shanghai->HK daily quota used 0.8% * FTSE China A50 -2.1% SHANGHAI, April 15 (Reuters) - China and Hong Kong stocks fell on Thursday, as worries about policy tightening mounted ahead of China’s first-quarter GDP data due on Friday. ** The CSI300 index fell 1.6% to 4,902.74 by the end of the morning session, while the Shanghai Composite Index lost 1.2% to 3,376.30. ** The Hang Seng index dropped 1.0% to 28,623.90, while the Hong Kong China Enterprises Index lost 1.5% to 10,831.14. ** Analysts and traders said China’s tightening had begun and more upbeat economic data would reinforce Beijing’s tightening bias. ** China will publish on Friday its first-quarter GDP data, along with March data on retail sales, industrial output and urban investment. ** A series of upbeat data released recently added to signs of a solidifying recovery in the world’s second-largest economy. ** “The central bank’s monetary policy stance would remain balanced with a tightening bias,” said Li Han, a fund manager at Shanghai Jiaorui Investment. ** Li said he had been avoiding large-cap blue-chips with lofty valuations and searching for opportunities in small- and mid-cap firms with solid growth and reasonable valuations. ** China’s banking sector took a hit on Thursday, with the CSI300 banks index shedding as much as 1.9%. ** China is widening the scope of stress tests on its lenders by including all of its 4,024 banks this year, a central bank publication said on Wednesday, amid concerns over mounting debt levels of companies and financial strains in some sectors. ** Also souring sentiment were worries over China’s bond market. ** The cost of insurance against a default in China’s dollar debt rose on Wednesday to its highest since October, on lingering concern over the effects of China Huarong Asset Management’s delay in reporting its results. ** China’s junk bonds would continue to be under pressure, which could weigh on the stock market and make stocks unable to better reflect the country’s economic recovery momentum, Hong Hao, head of research BOCOM International in Hong Kong, said in a note. (Reporting by Luoyan Liu and Andrew Galbraith; Editing by Subhranshu Sahu)