HK shares close at 2-wk high on Wall St rally; China gains

* HK trims gains on profit-taking, but closes at 2-week high

* Upside in HK limited by high valuations - brokers

* BYD declines after charger recall

* China's health-related stocks up on flu pandemic warning
(Updates to close)

By Sui-Lee Wee and Claire Zhang

HONG KONG/SHANGHAI, Nov 10 (Reuters) - Hong Kong stocks rose
to a two-week closing high on Tuesday, with investors taking
heart from a rally on Wall Street and a pledge by the Group of 20
to keep aid flowing to the world economy.

But the index trimmed earlier strong gains in afternoon trade
as investors took profit following a three-day rally.

The benchmark Hang Seng Index .HSI rose 60.61 points to
22,268.16.

Although brokers said the rally was likely to continue on
strengthening risk appetite, they said any upside on the index
would be limited as valuations look stretched.

"Valuations are not attractive at all," said Castor Pang,
research director at Cinda International. "Investors will not
increase their holdings on the Hong Kong stock market at this
level."

"They are only looking for an excuse to push the market
higher before they unload their positions," he said.

The agreement by G20 finance ministers and central bankers to
keep economic stimulus measures in place boosted hopes for
prolonged low interest rates, spurring a rally in global stocks.

"Liquidity remains abundant locally and that will limit the
downside in the short term," said Ben Kwong, chief operating
officer at KGI Asia.

Kwong said he expected Hong Kong's stock index to breach
23,000 within the next few days.

Turnover was at HK$70.5 billion ($9.1 billion), up from
Monday's HK$65.09 billion.

The China Enterprise Index .HSCE of top locally listed
mainland Chinese stocks rose 0.37 percent to 13,367.19.

Sinopec Corp, (0386.HK), Asia's top oil refiner, fell 1.5
percent to HK$6.72, even after China raised fuel prices, boosting
the profit outlook for the country's refiners. The stock rose as
much as 2.6 percent to a three-week high of HK$7 in the morning.

PetroChina (0857.HK) (601857.SS) (PTR.N), China's No. 2
refiner, gained 0.8 percent in Hong Kong to HK$10.12, retreating
from a two-week high of HK$10.24 set in morning trade.

The U.S. dollar briefly fell to a 15-month low overnight,
bolstering stocks pegged to commodities such as gold. Sino Gold
Mining (1862.HK) rose 5.7 percent to HK$54.65.

BYD Electronic (0285.HK), the battery making arm of BYD Co
(1211.HK), fell 5.14 percent to HK$6.65 after Nokia (NOK1V.HE)
said it would recall 14 million cellphone chargers made by the
Chinese company. [ID:nHKG280586].

Auto stocks surged after China said passenger cars sales in
October surged 76 percent from a year earlier, extending the
explosive growth in recent months as government incentive
policies continued to lure customers. [ID:nSHA159082].

Qingling Motors (1122.HK) jumped 32.02 percent to HK$2.35 and
Brilliance China (1114.HK) climbed 14.95 percent to HK$2.46.

SHANGHAI UP; PROPERTY LEADS

China's key stock index edged up 0.1 percent, rising for an
eighth session in a row to a three-month closing high with
property shares taking the lead, ahead of economic data for
October that is expected to be strong.

The Shanghai Composite Index .SSEC ended at 3,178.610
points. Losing Shanghai A shares outnumbered gainers by 489 to
384, while turnover edged up to 163 billion yuan ($23.88 billion)
from Monday's 158 billion yuan.

Property shares led the rise, with Poly Real Estate Group
(600048.SS) up 2.86 percent at 27.01 yuan after posting a 143
percent surge in contract property sales in the first 10 months.

Analysts said investors were encouraged by official comments
about the economic recovery and stable monetary policy.

Ma Delun, a vice-governor with the People's Bank of China,
reaffirmed on Tuesday that China would continue its accommodative
monetary policy stance. [ID:nBMA006388]

"Investors remain cautious after recent gains, but stock
valuations are relatively reasonable, backed by rising earnings.
The index has a chance to rise higher," said Chen Jinren, analyst
at Huatai Securities.

The 14-day Relative Strength Index rose to 65, edging close
to the overbought mark at 70.

"Profit-taking pressure pulled the index off the highs today.
Investors are waiting for tomorrow's economic data, which is
likely to be strong," said Cao Xuefeng, senior analyst at Western
Securities.

China Minsheng Banking Corp (600016.SS) edging up 0.12
percent to 8.12 yuan after saying on Tuesday that its failed
investment in U.S. lender UCBH Holdings Inc UCBH.O would have a
limited impact on its business. [ID:nSHA279897]

Health-related shares rose after the World Health
Organisation said over the weekend that the H1N1 flu virus was on
the rise in China. [ID:nL664239]

Henan Taloph Pharmaceutical (600222.SS) surged by its 10
percent daily limit to 10.96 yuan, while Shenzhen Neptunus
Bioengineering (000078.SZ) jumped 6.17 percent to 21.15 yuan.
(Editing by Chris Lewis)