* HK stocks hold five-month high on Wall Street gains
* Shanghai slips on low volume ahead of long holiday
* Analysts sceptical on China property tax reports
* HK-listed mainland banking counters weak, limiting gains
* Hengdeli down 5 percent after convertible bond offering (Updates to midday)
By Vikram S Subhedar and Farah Master
HONG KONG/SHANGHAI, Sept 21 (Reuters) - Shares in Hong Kong held a five-month high on Tuesday while Shanghai-listed shares were a tad weaker in light volume, with investors continuing to trim exposure ahead of a long holiday.
Hong Kong's Hang Seng Index closed the morning session 0.12 percent higher at 22,004.24, with optimism on the back of strong gains on Wall Street tempered by broad weakness in locally listed mainland banking stocks.
China's key Shanghai Composite Index was down 0.2 percent at 2583.2, trading in low volume above a key support level, with a long holiday starting on Wednesday deterring investors from taking new positions.
Analysts attributed the thin volume and lacklustre trading to investors staying away ahead of a series of holidays for the mainland starting on Wednesday. The market will only be open for a combined seven trading days in the next three weeks.
"Historically, investors are always more cautious ahead of holidays," said Wang Aochao, analyst at UOB Kay Hian in Shanghai.
No prominent sector dictated trade in the morning session, but property shares were mixed after local media reported that China may impose a property tax from early next year. Several analysts said they were sceptical it would happen.
"They have spoken about it for so long, in the near term it won't happen. There is a small possibility the tax will be implemented in China, but this is all still talk," said Wang.
China Vanke Co Ltd, the country's largest listed developer, gained 0.9 percent. Nanjing Chixia Development Co Ltd rose 1.8 percent, while Gemdale Corp slipped 0.2 percent.
Pharmaceuticals continued to weigh on the index, with investors taking profit after the sector's large gains over the past month.
Zhongzhu Holding Co Ltd dropped 7.4 percent, while Hangzhou Tian-Mu-Shan Pharmaceutical Enterprise dropped 5.2 percent.
Turnover of Shanghai A shares slipped to 36 billion yuan ($5.36 billion) by midday on Tuesday from 53 billion yuan on Monday morning.
HK FIRM, BANKS WEIGH
Hong Kong's Hang Seng Index stayed near a five-month high but gave up some earlier gains as investors remained cautious that the U.S. Federal Reserve may discuss further easing measures to stimulate the economy.
The index opened as much as 0.6 percent higher but pared gains to 0.12 percent by the midday break on subdued volumes.
Locally listed mainland banking shares, which have a large weighting on the broader market, continued to remain under pressure amid talk of further capital-raising and a rise in interest rates.
China Construction Bank Corp fell 0.6 percent, while Industrial & Commercial Bank of China Ltd was down 0.5 percent.
"While our analysis shows very modest impact from possible unfavorable rate moves, clearly it's not positive for bank earnings and remains a concern for investors," said JPMorgan analysts in a note and recommended investors to stay defensive.
Hong Kong Exchanges & Clearing (HKEx), which operates the Hong Kong stock exchange, was down 1.6 percent, the biggest drag on the benchmark, with investors taking money off the table after recent gains.
HKEx is among the top gainers on the Hang Seng Index this month, up 14.6 percent as trading activity picked up after the summer holidays and the initial public offering pipeline in Hong Kong heated up.
Luxury watch retailer Hengdeli Holdings Ltd slumped 5 percent after the company said it would raise HK$2.5 billion ($322 million) via a convertible bond offering. ($=6.71) (Editing by Chris Lewis)