* SSEC +0.2 pct, CSI300 +0.4 pct, HSI +0.2 pct
* A/H premium hit 1-yr high on China bullishness, strong yuan
* China margin financing hits the highest level this year
SHANGHAI, Sept 5 (Reuters) - Chinese shares rose for a third straight session on Tuesday, unfazed by growing tensions over North Korea, as investors bet economic data in coming weeks will remain largely robust despite higher financing costs.
Investors are also adding to positions amid expectations that further reforms will be announced after a Communist Party Congress that starts in mid-October.
The meeting will feature a key leadership reshuffle and set out the government's economic plans and priorities for the next five years.
China's blue-chip CSI300 index rose 0.4 percent to 3,860.40 points by the lunch break, while the Shanghai Composite Index gained 0.2 percent to 3,386.19.
The CSI rose 2.3 percent in September alone while the SSEC advanced 2.7 percent, posting their fourth and third straight month of gains, respectively.
Following stronger-than-expected factory activity surveys released last week, August data is expected to suggest China's momentum may hold up through the end of the year despite tighter policy.
That would give the government more room to push through much-needed structural reforms, such as streamlining and modernizing the bloated and inefficient state sector. Some concrete steps toward that goal were announced in August.
Adding to the upbeat mood, a private business survey on Tuesday showed that China's services sector expanded at a faster clip in August as new business orders picked up.
"Economic activity in China continues to run well, so the authorities can keep their focus on deleveraging and other reforms," economists at ING wrote in a research note.
"We believe that the government is setting the scene for the Politburo, given that the economy is already in 'reform mode'. And this is already having positive impacts on the economy and markets. Apart from that, the stronger yuan continues to stem capital outflows."
ING expects more mergers among state-owned enterprises (SOE) in the future, giving those new giants a more commanding share of the market and greater bargaining power.
More investors have climbed on board after the SSEC managed to breach and hold above a stubborn resistance level at 3,300 on Aug. 25.
Outstanding margin financing - money investors borrow to buy stocks - climbed for a fifth straight session to 948.7 billion yuan ($145.14 billion), the highest level this year.
Buying interest remains concentrated in blue-chip such as financial firms and the state-dominated resources sector that benefits from reforms such as reductions in excess capacity, which is helping to push up profit margins and prices.
Banks, real estate and producers of non-ferrous metals were among the biggest gainers on Tuesday.
Reflecting relevant strength recently in the mainland market, as well as the impact of a resurgent yuan, an index tracking Chinese shares' premium over their Hong Kong peers hit the highest level since July, 2016.
In Hong Kong, the Hang Seng index edged up 0.2 percent to 27,804.94 points, while the Hong Kong China Enterprises Index gained 0.4 percent to 11,224.72.
Resources shares and financial stocks gained but energy plays fell. ($1 = 6.5365 Chinese yuan renminbi)
(Reporting by Samuel Shen and John Ruwitch; Editing by Kim Coghill)