Hong Kong stocks climb on cooling Mideast tensions, trade optimism

* HK->Shanghai Connect daily quota used 7.9%, Shanghai->HK daily quota used 2.5%

* HSI +1.7%, HSCE +1.8%, CSI300 +1.3%

* FTSE China A50 +1.1%

Jan 9 (Reuters) - Hong Kong stocks staged a strong rally on Thursday, erasing all losses from the previous session, as U.S.-Iran drew back from the brink and investors cheered signs of Sino-U.S. trade progress.

** The Hang Seng index rose 1.7%, to 28,561.00, while the China Enterprises Index gained 1.8%, to 11,281.26 points.

** U.S. President Donald Trump said on Wednesday the United States did not have to respond militarily to Iran’s attack, while Iranian Foreign Minister Mohammad Javad Zarif said its strikes “concluded” Tehran’s retaliation.

** Sentiment was further supported as investors awaited the upcoming signing of a Sino-U.S. trade deal.

** China’s Vice Premier Liu He, head of the country’s negotiation team in Sino-U.S. trade talks, will sign a “Phase 1” deal in Washington next week, the commerce ministry said on Thursday.

** President Trump said on Dec. 31 that the Phase 1 deal with China would be signed on Jan. 15 at the White House.

** Market participants also drew optimism from data showing China’s consumer inflation steadied while factory-gate prices fell at a slower pace in December, giving Beijing room to stay the course on monetary easing as economic growth cools.

** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.5%, while Japan’s Nikkei index closed up 2.31%.

** The yuan was quoted at 6.9311 per U.S. dollar at 08:10 GMT, 0.21% firmer than the previous close of 6.9456.

** At close, China’s A-shares were trading at a premium of 26.92% over Hong Kong-listed H-shares. (Reporting by Luoyan Liu and Brenda Goh; Editing by Shailesh Kuber)