SHANGHAI - China stocks rose on Monday after the governor of the country's central bank vowed to increase implementation of prudent monetary policy to support the real economy.

Financials and property developers' shares led the gains, as regulators stepped up efforts to encourage lenders to extend loans to qualified real estate projects following a widening mortgage-payment boycott on unfinished houses.

The CSI300 index rose 1.2% to 4,297.55 at the end of the morning session, while the Shanghai Composite Index gained 1.5% to 3,276.17.

The Hang Seng index added 2.6% to 20,820.87 points. The Hong Kong China Enterprises Index gained 2.9%, to 7,162.31.

Chinese central bank Governor Yi Gang also said China's economy is facing downward pressure due to COVID-19 and external shocks.

Meanwhile, the state-owned Securities Times said China's monetary policy has ample room and sufficient tools, including further cutting banks' reserve requirements, to cope with new challenges amid a shaky economic recovery.

China's economy grew just 0.4% in the second quarter from the same period last year. While June data showed signs of improvement, analysts do not expect a rapid recovery due to the zero-COVID policy, an indebted property sector and a dim global outlook.

Several large Chinese cities, including Shanghai, are on their toes due to new outbreaks of COVID-19 infections, rolling out repeated mass testing or extending lockdowns.

China's central bank stepped up cash injections through open market operations on Monday, offering 12 billion yuan via seven-day reverse repurchase agreement, snapping a 10-day streak of a minimal 3 billion yuan ($444.61 million) of daily offering.

Mainland-listed real estate developers rose 2.7% and banks added 1.3%, while HK-listed mainland developers jumped nearly 5%.

Financials shares rose 2%, and energy jumped 3.6%.

Tech giants listed in Hong Kong gained 2.7%, with food-delivery giant Meituan up 6.8%.

(Reporting by Shanghai Newsroom; editing by Uttaresh.V)