SHANGHAI, April 7 (Reuters) - China stocks ended up more than 2% on Tuesday as markets resumed trading after a long weekend, with investor sentiment lifted by the government's latest stimulus to shore up the world's second-largest economy and a drop in cases of the new coronavirus. ** At close, the Shanghai Composite index .SSEC was up 2.05% at 2,820.76. ** The blue-chip CSI300 index .CSI300 was up 2.28%, with its financial sector sub-index .CSI300FS higher by 1.52%, consumer staples .CSI000912 up 3.11%, real estate .CSI000952 up 1.23% and healthcare .CSI300HC up 2.63%. ** The smaller Shenzhen index .SZSC ended up 3.18% and startups board ChiNext Composite index .CNT was higher by 3.31%. ** China's central bank said on Friday it was cutting the amount of cash that small banks must hold in reserve, releasing around 400 billion yuan ($56.38 billion) in liquidity to shore up an economy jolted by the coronavirus outbreak. urn:newsml:reuters.com:*:nL4N2BQ0ZP ** China has about 4,000 small and mid-sized banks. The latest cuts would lower their RRR to 6%. ** Overall, China is stepping up its domestic counter-cyclical measures to combat the virus hit, though investors need to pay attention to the negative impact on external demand given uncertainties around the outbreak overseas, Sinolin Securities analysts said in a report. ** Mainland China reported on Tuesday a drop in cases of the new coronavirus after closing its borders to virtually all foreigners to curb imported infections, while the central city of Wuhan, the epicentre of the outbreak, did not record any virus-related deaths for the first time since the outbreak began. urn:newsml:reuters.com:*:nL4N2BV0BD ** Around the region, MSCI's Asia ex-Japan stock index .MIAPJ0000PUS was firmer by 2.09%, and Japan's Nikkei index .N225 closed up 2.01%. ** At 07:26 GMT, the yuan CNY=CFXS was quoted at 7.0608 per U.S. dollar, 0.47% firmer than the previous close of 7.0938. ** As of 07:27 GMT, China's A-shares were trading at a premium of 26.08% over Hong Kong-listed H-shares. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ China frees up $56 bln for virus-hit economy by slashing small banks' reserve requirements urn:newsml:reuters.com:*:nL4N2BQ0ZP China posts drop in coronavirus cases, Wuhan lockdown due to end urn:newsml:reuters.com:*:nL4N2BV0BD ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Shanghai Newsroom; Editing by Christopher Cushing) ((luoyan.liu@thomsonreuters.com; Reuters Messaging: luoyan.liu.thomsonreuters.com@reuters.net))