* HK stocks rise on property issues ahead of land auction
* China up 0.76 pct led by telecommunications issues
* China Pacific Insurance holds above issue price on debut (Updates to close)
HONG KONG/SHANGHAI, Dec 23 (Reuters) - Hong Kong shares gained for second straight session led by property plays on hopes for strong response to a government land auction early next week, while China stocks gained with telecommunications plays up on strong subscriber growth.
Anticipation of strong results from a Hong Kong government land auction to be held on Monday fuelled buying for local property stocks. Henderson Landrose 4.01 percent, Wharf climbed 3.03 percent, Sun Hung Kai Properties gained 2.81 percent and Sino Land was up 2.68 percent.
"Optimism over the land auction results fuelled buying interest for local property issues, but it might not be indicative in subdued trade," said Linus Yip, strategist at First Shanghai Securities, adding that the underlying tone of the overall market remained soft.
Market wacthers generally expected the government to fetch HK$10.9 billion ($1.4 billion) from the sale of two plots of land in the New Territories, about 50 percent above the offer prices with keen keen competition expected among developers.
The benchmark Hang Seng Indexended up 1.12 percent or 236.7 points at 21,328.74 in subdued trade with investors staying away on concern over capital outflows and further measures from the Chinese authorities to curb assets bubbles.
Chinese banks also firmed. China Construction Bankrose 1.56 percent, Bank of China gained 2.2 percent, and ICBC advanced 1.59 percent. Index heavyweight HSBC finished up 0.75 percent.
Market debutant China Pacific Insurance (Group) Co, China's third-largest life insurer, topped the most heavily traded list as it struggled to hold above its issue price following a $3.1 billion IPO -- the world's seventh-largest IPO this year. [ID:nTOE5BM01X]
The insurer slid as to as low as HK$27.50 before closing up 0.89 percent at HK$28.25. Larger rival China Lifegained 1.63 percent and Ping An was up 0.75 percent.
Shanghai-listed China Pacific Insuranceedged up 0.34 percent to 23.32 yuan.
Another new listing Huayu Expresswayended at HK$1.29, up 0.8 percent from its issue price of HK$1.28.
The China Enterprises Indexof top locally listed mainland Chinese stocks closed up 1.45 percent at 12,528.66.
Market turnover fell to HK$44.19 billion ($5.7 billion), from Tuesday's HK$45.96 billion. The market will close at midday on Thursday.
Geely Automobilerose for second straight session up 7.28 percent to HK$3.98 in its biggest single-day gain since Nov 30.
Ford Motorand Zhejiang Geely had addressed most of the big issues in the pending sale of Ford's Volvo car unit to the Chinese automaker, a source with knowledge of the talks said on Wednesday, paving the way for the biggest acquisition of a foreign carmaker by a Chinese company. [ID:nTOE5BM03I]
CITIC Resourcesjumped 7.11 percent to HK$2.26 after it said it had sold its direct interest in Australian miner Macarthur Coal's operating assets to Macarthur for A$105 million ($92.02 million).
Maoye Internationalextended early losses to fall 21.34 percent to HK$1.99, its lowest close since Oct 8. The Chinese department store operator said its chairman, Huang Mao Ru, had never been investigated by the Chinese government or any law enforcement authorities, contrary to recent media reports.
SHANGHAI RISES ON TELECOM ISSUES
China's key stock index rose 0.76 percent on Wednesday, with telecommunications-related shares firmer on strong subscriber growth, although some recently listed companies slipped below their IPO prices with sentiment weighed down by worries over rising share supplies.
The Shanghai Composite Indexended up 23.257 points at 3,073.777, managing a modest technical rebound after closing at the lowest level in seven weeks on Tuesday.
Gaining Shanghai A shares outnumbered losers by 792 to 97, while turnover sank to 91 billion yuan ($13.33 billion) from Tuesday's already low 99 billion yuan.
The index remained below a closely watched support level at its 125-day moving average, now at 3,096 points, after closing below that level on Tuesday for the first time in nearly three months.
"The index managed a mild technical rebound, lifted by telecoms-related shares as the industry outlook improved," said Cao Xuefeng, senior analyst at Western Securities in Chengdu. "Sentiment is still fragile, but the index has support at the psychologically and technically important 3,000-point level."
Analysts played down any impact from comments on Tuesday by Chinese central bank Governor Zhou Xiaochuan that monetary policy needed to pursue multiple objectives beyond just fighting inflation, which sparked overseas talk of a possible Chinese interest rate rise. They stressed that the country's economic recovery remained at an early stage.
Telecommunications shares were strong for a second day, with industry heavyweight China United Network Communications, the second-most active stock in Shanghai, jumping 2.32 percent to 7.05 yuan.
The official China Securities Journal reported that the number of mobile phone users in China had risen 17.3 percent from a year earlier to 717 million, according to the latest data for November, while the number of users of China Unicom's third-generation (3G) technology had surpassed its 2G users.
Metallurgical Corp of China, the most active Shanghai stock, fell below its IPO price of 5.42 yuan for the first time since listing on Sept. 21. It ended 4.04 percent lower at 5.22 yuan.
China Shipbuilding Industry, which listed in Shanghai last Wednesday, rebounded 1.34 percent to 7.54 yuan after slipping to 7.34 yuan, below its IPO price of 7.38 yuan.
The property sector steadied after a recent fall, with the Shanghai property sub-indexedging up 0.06 percent after sinking 3.42 percent on Tuesday. Sector heavyweight China Vanke rose 0.29 percent to 10.33 yuan.
The authorities have been seeking to cool potential price bubbles in the property and stock markets by tightening rules on real estate transactions and stepping up approvals of new share issues. (Editing by Chris Lewis)
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