Hong Kong shares rise 1.4 pct, led by financials

* Banks lead rise in Hong Kong stocks

* Properties under pressure on mortgage rate hikes

(Updates to midday)

HONG KONG, Dec 3 (Reuters) - Hong Kong shares rose 1.4 percent on Wednesday, with financials leading the charge after their U.S. peers gained overnight, but property stocks fell after the city's big lenders raised mortgage rates.

Banks stocks rebounded from recent losses, with global lender HSBC (0005.HK), which lost 6.4 percent on Tuesday, gaining 1.7 percent and ICBC (1398.HK), China's largest lender, up 2.4 percent.

"Local investors are unwilling to sell. They have the view that the U.S. market has already hit its bottom this year," said Conita Hung, head of equity at Delta Asia Financial. "The underlying tone (of local stocks) is seen firm as some funds may unwind their heavy cash positions and come up for bargain hunting."

The benchmark Hang Seng Index .HSI ended the morning session up 188.56 points at 13,594.41. A total of HK$21.03 billion ($2.7 billion) worth of shares were traded, down from HK$22.68 billion at midday on Tuesday.

Shares of China Construction Bank (0939.HK) surged 2.2 percent after Central Huijin, the country's sovereign wealth fund, said on Wednesday it had raised its holdings of A shares in the Chinese bank (601939.SS) to 70.8 million shares as of Nov. 28. [ID:nSHA264730]. The stock fell 4.2 percent on Tuesday.

The China Enterprise Index of top locally listed mainland Chinese firms .HSCE rose 2.1 percent to 7,152.14 points.

But property shares lagged the broad market rebound after Bank of China (Hong Kong) (2388.HK) joined the city's major lender, HSBC (0005.HK), in raising Hong Kong mortgage rates, helping to drag the blue chip property index .HSNP down 1.8 percent to 15,236.59.

A spokeswoman for the Chinese bank said on Wednesday it would increase the mortgage rate by 50 basis points to between 3.5 and 3.75 percent with effect from Dec 4. HSBC has raised its mortgage rate in Hong Kong by up to 75 basis points.

Shares of Sun Hung Kai Properties (0016.HK) fell 4.6 percent, while rival Cheung Kong (0001.HK) eased 1.8 percent.

"Anticipation of further mortgage rate hikes and concern over the jobless situation will halt new home buyers," Hung said.

Some analysts said recent strong demand for new residential projects did not mean the property cycle had reached a turning point.

Hong Kong home sales dropped to a 17-year low in November as the deepening global financial crisis haunted new home buyers, the South China Morning Post said.

Hopson Development (0754.HK) bucked the weak property trend, surging 15.6 percent after the Chinese property developer said late on Tuesday it had made a successful bid for a piece of land in Beijing for 859.2 million yuan.

Shares of CITIC Pacific (0267.HK) fell 6.8 percent as the stock resumed trading after the steel-to-property conglomerate urged shareholders to support a $1.5 billion bailout plan. [ID:nHKG294627] (Reporting by Donny Kwok)