China stocks rise, helped by blue chips; Hong Kong also up
* CSI300 +0.7 pct; SSEC +0.7 pct; HSI +0.7 pct;
* Brokerage shares jump on prospects of Shanghai-London Connect
* ChiNext shares still expensive after slump - analyst
SHANGHAI, Sept 22 (Reuters) - China stocks edged higher on Tuesday morning as strength in blue chips countered a pullback in small cap shares, in a further sign of improving market stability.
Hong Kong shares were also firmer, taking cues from an improving outlook in global markets.
China's blue-chip CSI300 index rose 0.7 percent, to 3,331.42 points at the end of the morning session, while the Shanghai Composite Index gained 0.7 percent, to 3,177.02 points.
China's volatility index, a gauge of investor fears, has dropped to 40 percent from an August peak of 64 percent.
But some analysts warn that with valuations of small stocks still high, and the Chinese economy yet to find its feet, the rebound could be temporary.
"Remember we're still in a bear market," said Chang Chengwei, index futures analyst at brokerage Hengtai Futures. Continuación...