(Bloomberg) — Chinese stocks extended their gains from last week as Beijing backed up its pledge to shore up the economy by announcing more measures to boost consumption and support the ailing property sector.

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The Hang Seng China Enterprises Index, which tracks the nation’s stocks listed in Hong Kong, jumped as much as 3.2%, adding to its 6.1% surge from last week. The CSI 300 Index climbed up to 1.8% before paring some gains. Both measures were headed for their best month since January. A Bloomberg Intelligence gauge of real estate shares was set to enter a bull market.

Sentiment toward China’s markets is improving fast as regulators introduce incremental steps, following through on the promises made at last week’s Politburo meeting. Authorities announced new measures to support consumption on Monday, while a separate report said big cities such as Beijing and Shenzhen may ease restrictions on the property sector. Overseas funds were set to be net buyers of onshore Chinese stocks for a fifth straight session.

“The government’s stance has clearly turned more supportive,” said Vey-Sern Ling, managing director at Union Bancaire Privee. There is more confidence that China will back up stimulus talk with concrete measures, he added.

Beijing’s actions over the past few days are raising hopes among investors, who have been burned repeatedly in the past as policy promises lacked implementation. China should provide easier access for mid- to long-term funds to invest in its stock market as “stabilizers” and guide household savings to the market as part of its capital market reform, China Securities Journal said in a front-page commentary Monday.

In focus will be a joint press briefing later Monday by China’s top economic planning agency and other ministries to outline measures to expand consumption, a key driver authorities are pinning their hopes on to spur growth. The government announced a raft of steps Friday focused specifically on the so-called light industry, which covers items from home goods, food and paper-making to plastic products, leather and battery.

Some better-than-expected earnings reports, including those from restaurant operator Haidilao International Holding Ltd. and battery maker Contemporary Amperex Technology Co., have added to the positive sentiment.

“We think the upcoming earnings results will be a factor, and although expectations are not high, a continued recovery in big tech earnings would support the rally given the weighting in China indices,” said Marvin Chen, a Bloomberg Intelligence analyst.

The latest rebound is reminiscent of the market’s impressive surge over the November-January period after China dismantled stringent Covid curbs and reopened its economy and society. Poor economic data, persistent property woes and geopolitical tensions then combined to dent sentiment, and cautious investors have since sold into intermittent rallies.

“We still believe last October was the long-term trough of Chinese markets,” said Kerry Goh, chief investment officer at Kamet Capital Partners Pte. “On the shorter-term basis, there would be some volatilities but the lows should be getting higher” as China isn’t facing inflation and valuations are at deep discounts to major markets.

To-be-sure, China’s economic recovery remains a concern and investors would be keen to see the impact of the latest measures. Economic activity lost more steam in July with manufacturing contracting again and the services sector weakening, data showed on Monday.

The recent optimism has revived inflows into Chinese stocks, at least for now. Overseas funds were net buyers of 9 billion yuan ($1.3 billion) of onshore equities in the morning session via trading links with Hong Kong. They bought a net 16.4 billion yuan on Friday, taking purchases last week to the largest since January.

Jefferies Financial Group Inc. analysts including Calvin Leung and Shujin Chen are “positive” on the market and the property sector for three-to-six months, they wrote in a note dated July 30. However, they added that some investors may sell when city-level policies start to roll out, given the lagging impact on the physical market.

–With assistance from Abhishek Vishnoi.

(Updates with comments and background)

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