HK shares up 4.5 pct on China talk,U.S recovery hopes

HONG KONG, Nov 21 (Reuters) - Hong Kong stocks rallied strongly at midday on Friday, ending the morning session 4.5 percent higher, as U.S. stock futures pointed to a recovery on Wall Street and amid talk that China may adjust rates again.

"A rumour has been doing the rounds since midday today, saying China may cut deposit rates by 27 basis points, to match the recent reduction in lending rates," said Peter Lai, director with DBS Vickers.

China Construction Bank (0939.HK), which had fallen 12.7 percent in the previous three sessions on talk that Bank of America may dilute some of its holding in the Chinese lender, jumped 6.7 percent.

The benchmark Hang Seng Index .HSI was up 553.22 points at 12,851.78 after opening nearly 4 percent lower.

The China Enterprises Index of top locally listed mainland Chinese firms .HSCE had gained 3.4 percent to 6,400.62. (Reporting by Parvathy Ullatil; editing by Anne Marie Roantree)