SHANGHAI - Stock analysts expect another winning week for equities on the Chinese mainland.

That's after the country's benchmark index extended its winning streak on Monday, following the announcement of a cut in the reserve requirement ratio for banks for the first time this year as concerns rise over the strength of economic growth.

Banking shares mostly rallied on the first trading day after the announcement of a cut of half a percentage point in the RRR. The reduction, which will come into force on Feb 24, will add loanable funds of around 400 billion yuan ($63 billion) to the banking system.

Agricultural Bank of China Ltd rose by 0.74 percent, while Bank of China Ltd shares closed higher by 0.33 percent.

The Shanghai-based Wolong Real Estate Group Co Ltd led a gain of 0.76 percent for a gauge of real estate companies on speculation that easier access to credit could prop up sagging property prices in larger cities.

"Before, many people were very concerned about whether a rally over previous weeks could be sustained. However, the news of the cut in the reserve ratio over the weekend saved the rally," said Wang Jianhui, chief economist with Southwest Securities Co Ltd.

Wang expects the benchmark index to end the week higher and post a sixth weekly gain on the back of renewed market optimism as a result of the central bank's move.

The Shanghai Composite Index edged up 0.27 percent, or 6.42 points, on Monday to 2,363.60 points. It rose 0.2 percent last week, capping a fifth straight week of gains and the longest winning streak since 2010.

Fan Wei, an analyst with Hongyuan Securities Co Ltd, said the index will hit 2,500 points in the "near future" on improved market liquidity.

Many stocks across Asia also rose on Monday. The Nikkei 225 Stock Average gained 1.08 percent, despite a report that showed that Japanese exports fell last month. However, the Hang Seng index in Hong Kong fell 0.31 percent to close at 21,424.79 points.

On Saturday, the People's Bank of China said it will lower the proportion of cash that lenders must hold against their loans. That will lower the RRR for the biggest banks to 20.5 percent from 21 percent. In November, the central bank cut the RRR for the first time in three years.

The reduction came after the Chinese economy showed stronger signs of slowing down and inflation eased this year. Trade and monetary data for January all signaled increased downward pressure on the economy. Many economists have predicted a slower rate of growth in the first quarter than the 8.9 percent registered in the previous quarter.

Lu Zhengwei, chief economist at Industrial Bank Co Ltd, said the cut has reaffirmed his view that China's monetary policy has changed direction toward increased easing, which will add market liquidity and benefit investments.