BEIJING: Iron ore futures extended their rise for a third session on Wednesday, aided by lingering optimism from further support to the property market in top consumer China, although a weakening steel market and mounting risk-off sentiment capped gains.

The most-traded January iron ore on China’s Dalian Commodity Exchange (DCE) ticked up 0.46% to 983 yuan ($136.32) a metric ton, as of 0208 GMT, following a rise of nearly 2% a day before.

The benchmark December iron ore on the Singapore Exchange was 0.25% higher at $133.6 a ton, after touching an intra-day high of $134.3 a ton, which is also the highest since February.

Chinese regulators are drafting a list of 50 real estate developers eligible for funding, Bloomberg News reported on Monday, citing people familiar with the matter. “This could help steel demand from the construction sector to stabilise, although a seasonal decline in construction activity will act as a constraint to steel demand,” analysts at ANZ Bank said in a note.

Analysts warned of possible risks of a downswing in iron ore prices as authorities may intensify supervision following the recent price rally. Other steelmaking ingredients extended price falls, with coking coal and coke on the DCE down 1.34% and 1.16%, respectively.

Steel benchmarks on the Shanghai Futures Exchange were broadly lower. Rebar shed 0.67%, hot-rolled coil declined 0.84%, wire rod slid 2.02% and stainless steel slipped 1.05%.

“Steel fundamentals are not very supportive as the destocking has slowed down,” analysts at Sinosteel Futures said in a note. The weakness in the futures market came despite some Chinese steelmakers raising their spot prices by between 50 yuan and 200 yuan a ton.

Downstream consumers have showed resistance to higher steel prices as demand has seasonally slowed while steel production has somewhat speeded up amid improved profitability, analysts at Everbright Futures said in a note.