You need to create System.Threading.Timer object and on it's Tick event update your label text. Also it's more correct to do
DateTime.Now.ToString("hhMMss");
or
DateTime.Now.ToShortTimeString();
instead several .ToString() calls.
The result code will be something like that
new System.Threading.Timer((state) => { BeginInvoke((Action)delegate() { label1.Text = DateTime.Now.ToShortTimeString(); }); }, null, 1000, 1000);