HK, China shares mixed; banks up in HK, Vanke eases

* HK shares rise 1.8 pct; banks lead

* Bank of China hits 22 months high

* China stocks down 1.7 pct; Vanke eases

(Update to midday)

By Donny Kwok and Claire Zhang

HONG KONG, Sept 16 (Reuters) - Hong Kong shares rose 1.75
percent on Wednesday led by banks as stronger economic data in
the United States reinforced hopes of a turnaround in the global
economy, but China stocks remained soft.

Brokers said investors were more willing to bet on further
upside on hopes of improved corporate earnings as the economy
recovers and anticipation of limited downside risk on government
support ahead of the country's national day.

Bank shares rose on hopes the sector will among the first to
benefit as the economy recovers and after the latest U.S.
economic indicators lifted overseas markets.

"Hope of a gradual economic recovery boosted sentiment and
banks are set to benefit," said Alfred Chan, a chief dealer at
Cheer Pearl Investment.

Bank of China (3988.HK) climbed 2.4 percent to HK$4.35, its
highest since November 2007. China Construction Bank (0939.HK)
rose to HK$6.43, its highest since August 2008, before the stock
steadied at HK$6.4, still up 1.8 percent from the previous close.

ICBC (1398.HK) surged 2.7 percent to a 16-month high HK$6.05,
and HSBC (0005.HK) rose 1.9 percent to a 5-week high of HK$86.45.

The benchmark Hang Seng Index .HSI surged 365.90 points to
21,232.27. The China Enterprises Index .HSCE, which represents
top locally listed mainland Chinese stocks, was up 1.84 percent at
12,380.06.

China Huiyuan Juice (1886.HK) fell 0.94 percent to HK$5.25,
its lowest since Sept. 4, after the Chinese juice maker said its
first-half earnings fell 81.8 percent on uncertainties arising
from a proposed Coca-Cola takeover offer and the negative impact
on sales of restructuring and strategic initiatives.

PCCW (0008.HK) shares rose nearly 2 percent after controlling
stakeholder Pacific Century Regional Developments (PCRD)
(PCEN.SI) said it would not appeal a Hong Kong court ruling that
blocked a $2.2 billion bid to privatise PCCW.

Sun Hung Kai Properties (0016.HK) gained 1.8 percent to
HK$114 after Asia's largest property developer posted slightly
better-than-expected fiscal second-half earnings.

SJM Holdings (0880.HK), flagship company of gaming mogul
Stanley Ho, rose 6.9 percent to an all time high of HK$4.50 after
it said the second half of 2009 had started well with total
gaming revenue in Macau rising significantly.

New listing China All Access (0633.HK), an communication
application solution provider, rose 22.5 percent on its first day
of trading to as high as HK$1.96 before the stock steadied at
HK$1.80, comparing with the issue price of HK$1.60 per share.

CHINA STOCKS FALL ON PROFIT-TAKING

China's key stock index fell 1.7 percent on Wednesday, with
the property sector soft after the country's second-biggest
property developer China Vanke's shareholders approved its $1.6
billion share offer, which triggered profit-taking.

The Shanghai Composite Index .SSEC ended the morning at
2,982.566 points, after edging up 0.23 percent on Tuesday to
one-month closing high.

Losing Shanghai A shares outnumbered gainers by 631 to 255,
while turnover picked up to 91 billion yuan ($13 billion) from 79
billion yuan on Tuesday morning.

China Vanke (000002.SZ), the most active share in Shenzhen,
dropped 0.5 percent to 11.89 yuan after the shares were suspended
on Tuesday. It said its shareholders approved a new public share
offer to raise up to 11.2 billion yuan ($1.6 billion).
[ID:nSHA265677] [ID:nSHA328268]

"Investors who are worried about the fund-raising plan may
drain money out of the market, and some of them chose to lock in
profits first as the index is still fluctuating around the key
resistance level of 3,000 points," said Wu Nan, analyst Xiangcai
Securities in Shanghai.

Investors often worry that such fund raising drains money
from the stock market and hurts sentiment but some analysts said
the situation with Vanke was different.

Shareholders' approval of Vanke's fund-raising plans suggests
underlying confidence towards the property sector through next
year, so its impact on the overall market may be limited.

"It is very helpful for Vanke to buy land; the fund raising
suggests it is confident about the sales outlook for real estate
with the property sector on a solid track for recovery," said Guo
Yanlin, head of research unit at Shanghai Securities.

Vanke's rivals Gemdale (600383.SS), China Merchants Property
(000024.SZ) and Poly Real Estate Group (600048.SS), who are also
rushing to raise money after a government stimulus plan, saw
their shares fall around 2 to 3 percent.

Financial shares were weak, with China Life Insurance
(601628.SS), the country's top life insurer, losing 1.5 percent
to 28.43 yuan, after saying it earned 210.7 billion yuan ($31
billion) in insurance premiums in the first eight months of this
year.

Wuliangye Yibin (000858.SZ), one of China's top liquor
makers, dipped 0.8 percent to 22.88 yuan after the official China
Securities Journal cited its president saying the reason for a
probe targetting the firm was not known, but its operations had
not been affected and it was confident of achieving this year's
sales goal.

The company said on Sept. 9 that it was being investigated by
the country's stock watchdog, pushing its share price sharply
lower.

The official China Securities Journal cited CLSA-Asia-Pacific
Markets as expecting the Shanghai Composite index would hit 4,400
points in 18 months.

CLSA noted earning improvements could drive the index in the
second half of this year and that the liquidity situation would
not be bad as more funds are expected to flow into the mainland.
It holds a positive view of the banking, property, insurance and
health sectors.
(Editing by Jonathan Hopfner)