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* HSI, H-shares +1,2 pct; CSI300 -0.6 pct, Shanghai -0.2 pct
* Cyclicals lift Hong Kong on relief from Summers' Fed withdrawal
* Galaxy at record high after pro-Beijing groups win Macau election
By Clement Tan
HONG KONG, Sept 16 (Reuters) - Hong Kong shares soared to their highest in 17 weeks early Monday, buoyed by Lawrence Summers' withdrawal as a candidate to head the Federal Reserve and by Macau election results that made its gambling sector a standout performer.
News that Lawrence Summers pulled out of the race to head the Fed lifted most Asian markets, which feared that the policy hawk could accelerate tapering of the Fed's aggressive monetary easing.
Still, a paring of the Fed's $85 billion a month bond-buying could be announced after its Fed's meeting on Tuesday and Wednesday.
Also boosting Hong Kong market was how pro-business groups emerged victorious in Macau's election over the weekend.
Mainland Chinese markets underperformed Asia. At the midday break, the CSI300 of the leading Shanghai and Shenzhen A-share listings was down 0.6 percent, while the Shanghai Composite Index slipped 0.2 percent.
The Hang Seng Index rose 1.2 percent to 23,182 points, its highest since May 22. The China Enterprises Index of the top Chinese listings in Hong Kong also climbed 1.2 percent.
Mainland Chinese markets will be shut Thursday and Friday for the Mid-Autumn Festival, while Hong Kong will be closed on Friday.
"The Macau election result, along with hopes that the public holiday later this week will give gaming revenue a boost, are supporting strong gains for the casinos," said Jackson Wong, Tanrich Securities' vice-president for equity sales.
Galaxy Entertainment spiked 5.4 percent to a record high, while Sands China jumped 4 percent - to near a record high set last week - after pro-Beijing groups won Macau's fifth legislative election. Local media reported that voter turnout in the Chinese enclave dipped from four years ago.
This month, Galaxy has surged nearly 17 percent and Sands China is up a more modest 8 percent as unofficial weekly revenue impressed, raising hopes of a strong September ahead of the holidays later this week, which could further buoy revenue.
Suning Appliance jumped 4.9 percent in Shenzhen after local media reported China's largest electrical appliance retailer may become the first private company to run a retail bank after the State Administrator for Industry and Commerce approved the name "Suning Bank" for use.
China needs to do more to develop private banks and make asset securitisation a standard practice as it tries to strengthen its financial system, central bank governor Zhou Xiaochuan wrote in an article on the official People's Daily website.
Chinese financial A-shares were broadly weaker. Shanghai Pudong Development Bank tumbled 4.5 percent in Shanghai, but is still up 51 percent from a June 24 trough. Most of the rally for the stock, which last Thursday closed at its highest since mid-April 2010, came after Beijing announced approval of a free-trade zone in Shanghai.
China Minsheng Bank , which was up 1.6 percent in Hong Kong and down 1.6 percent in Shanghai, said at the midday trading break it has entered a strategic partnership with the Alibaba Group.