A saleswoman introducing housing projects to visitors at a recent real estate expo in Beijing. Property shares outperformed the benchmark Shanghai index yesterday. [Wei Yao/China Daily]

The continuation of the macro economic policy set at China's annual Central Economic Work Conference cleared doubts about a tighter monetary policy and boosted market confidence in a mid- to long-term upward trend, according to analysts.

"The government's consistent stance on the macro economic policy has cleared market worries about a potentially tightened policy and the market is likely to see a steady uptrend in the mid- to long-term prospect," said Li Jianfeng, an analyst with Shanghai Securities.

The three-day Central Economic Work Conference, which concluded on Monday, reiterated the government's stance on maintaining a proactive fiscal policy and moderately loose monetary policy for the next year.

However, Li pointed out that the expectation on the policy continuity has already been priced into the market so its impact will be gradually reduced in coming days.

During the past two weeks, the Shanghai Composite Index has responded strongly to the expectation about the result of the meeting, witnessing a V-shape movement.

The benchmark index declined 3.5 percent, the largest drop in three months on Nov 24 amid concerns over a possible tightened monetary policy. But the market has seen a strong rally since the central government said in a previous statement that it would stick to the loose monetary stance confirmed by the economic meeting.

The conference also laid out specific measures to facilitate the structural adjustment toward a consumption-driven economy, including policy support for first-time home buyers and those who purchase properties to upgrade them.

Analysts noted that such policy support would give a boost to the real estate market that is likely to be the main economic driver next year.

"This suggests that the government is not ready to take tough measures to cool off the real estate market before export growth recovers to a comfortable level," said Jun Ma, Deutsche Bank's chief economist for Greater China, in a research report.

The property sector yesterday outperformed the benchmark Shanghai index with Zhejiang Guangsha Co Ltd jumping to the 10 percent daily trading limit.

Ma noted that the policy support for the relaxation of the hukou system in second- and third-tier cities bodes well for property demand and should help accelerate the pace of urbanization in these cities over the medium term.

Consumer sectors, particularly the auto and electronic sectors, are also likely to benefit from the government's clear signal to support domestic consumption.

Shares in SAIC Motor, China's top vehicle producer, edged up 0.27 percent to 25.76 yuan after it said it sold 252,190 vehicles in November, up 91 percent from a year earlier, helped by government stimulus schemes that boosted consumption of domestic products including cars.

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