BEIJING: Iron ore futures prices gained for a second straight session on Tuesday, supported by pre-holiday restocking by steelmakers in top consumer China and revived hopes of stimulus.

The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 1.29% higher at 783 yuan ($107.28) a metric ton.

The benchmark January iron ore on the Singapore Exchange recouped earlier losses to rise 0.21% to $101.5 a ton by 0712 GMT. It had fallen to $99.9 earlier in the session. “Winter restocking of iron ore among steel mills is still underway, so we believe ore prices will find some support in the near term and destocking at ports will likely continue until end-January,” said Jiang Mengtian, a Shanghai-based analyst at consultancy Horizon Insights.

“We peg the support level at 760 yuan and 770 yuan a ton and the resistance level at 810 yuan a ton.” Chinese steelmakers usually build up stocks ahead of the Chinese New Year, which starts from Jan. 28, to meet production needs during and after the holiday. Market sentiment was also boosted by a Reuters report that Chinese authorities have agreed to issue 3 trillion yuan worth of special treasury bonds next year, which would be the highest on record, as Beijing ramps up fiscal stimulus to revive a faltering economy.

A few cities in northern China, including steel production hub Handan, announced emergency response from Monday amid forecast air pollution, according to consultancies Lange Steel and Mysteel. This pressured the key steelmaking ingredient earlier in the session, said analysts. Local steel mills are typically required to curb production under such emergency actions. Other steelmaking ingredients on the DCE were mixed, with coking coal down 0.52% and coke up 0.59%. Most steel benchmarks on the Shanghai Futures Exchange advanced. Rebar rose 0.91%, hot-rolled coil edged up 0.53%, stainless steel strengthened 0.54%, while wire rod shed 0.42%.