* HSI up 0.9 pct after hitting 14-month closing high * Liquidity more than fundamentals seen driving markets
* Shanghai up 0.29 percent, upside meeting resistance (Updates to midday)
By Nerilyn Tenorio and Claire Zhang
HONG KONG/SHANGHAI, Oct 15 (Reuters) - Hong Kong stocks climbed above the 22,000-point level with a 0.89 percent gain on Thursday morning, buoyed by ample liquidity and optimism for an improving global economy.
Banks, property and export-related stocks charged ahead, fuelled by fund inflows from investments exiting the U.S. dollar, which had weakened further against other currencies by midday.
Shanghai's key stock index edged up 0.25 percent, led by brokerage shares, on strong earnings and upbeat economic data indicating the economic recovery is on track.
But index movements on both bourses began meeting key chart resistance towards midday as worries about heavy new share supplies weighed on sentiment, especially on the mainland market.
"The market is driven more by liquidity than fundamentals," said Daniel Chan, senior investment strategist at DBS Bank in Hong Kong. "Some traders have begun taking profit, and the downside pressure is now greater than the upside," he said.
The benchmark Hang Seng Index, which closed at a 14-month high on Wednesday, was up 195.02 points at 22,081.50 at the midday break, off a session high of 22,250.35.
Turnover was at HK$48.8 billion ($6.3 billion), up from midday Wednesday's HK$33.9 billion.
Index heavyweight HSBC Holdings rose 1.36 percent. Bank of China and China Construction Bank advanced 1.6 percent each.
The China Enterprises Index of top locally listed mainland Chinese companies was up 1.1 percent at 12,917.84, off a high of 13,046.07.
BUBBLE WARNING
The property sub-index edged up 0.68 percent on previously unserved demand, with investors ignoring warnings that a bubble might be forming in the sector. Stocks here were now off their early highs. Cheung Kong was up 0.9 percent and Sun Hung Kai up 0.59 percent.
Poly (Hong Kong) Investments resumed trade after a suspension, jumping 4.61 to HK$9.30 after the property developer said it planned to raise HK$3 billion ($387.1 million) in a share placement to boost its capital. (http://www.hkexnews.hk/listedco/ listconews/sehk/20091014/LTN20091014594.pdf)
First Pacific resumed trading with an initial gain of 1.9 percent, before falling 3.21 percent to HK$5.13. The conglomerate said it planned to raise $282.3 million through the rights issue to expand its mining business in the Philippines and Southeast Asia. (http://www.hkexnews.hk/listedco/listconews/ sehk/20091015/LTN20091015002.pdfAsia.)
EXCESSIVE SHARE SUPPLY
The Shanghai Composite Index ended the morning at 2,977.988 points after rising as high as 3,014.260, breaching the psychologically important 3,000-point level for a second straight session.
But losing Shanghai A shares edged out gainers by 484 to 406, while turnover dropped to 62 billion yuan ($9.1 billion) from Wednesday morning's 73 billion yuan.
Annual growth in China's broad M2 measure of money supply accelerated to 29.3 percent in September from August's 28.5 percent, while banks extended 516.7 billion yuan in new loans in September, up from 410.4 billion in August, the central bank said on Wednesday. Both figures beat forecasts.
China also drew $63.8 billion in foreign direct investment in the first nine months of the year, down 14.2 percent from the same period of 2008 but an improvement from a 17.5 percent fall in the first eight months, while Chinese property investment growth quickened in September.
"Although the economic data seems positive, the outlook for more share supply could drain funds from the main board," said Wen Lijun, analyst at Nanjing Securities.
"The index may be set for a mild rise today, but with additional batches of new start-up shares due to be issued, plus more share supply on the main board, the index could hover around key resistance at 3,000 points for days."
The official Shanghai Securities News reported that the second batch of companies to be listed on ChiNext, a Nasdaq-style bourse for start-ups expected to start trading this month, locked up 466.8 billion yuan in funds when subscriptions were taken this week, less than had been expected.
Brokerage shares were firmer as business from listings of start-up firms boosted their earnings outlook.
Guoyuan Securities, Hong Yuan Securities and Northeast Securities rose 3 to 6 percent after issuing estimates for an increase in nine-month net profit of 50 percent or more.
China International Travel made a strong debut on the main board, rising 41 percent from its IPO price to 16.63 yuan on an upbeat outlook for the travel market, after raising 2.6 billion yuan in an initial public offering last month
Ping An Insurance climbed 1.54 percent to 56.12 yuan after saying that total premium income for the first nine months of the year rose 34.6 percent from a year earlier to 133.5 billion yuan. (Editing by Chris Lewis)