Chinese stocks gained for a third consecutive day Wednesday, partly lifted by the preliminary readings of China's purchasing managers index (PMI) announced Wednesday, which showed a rise to 49.7 in February from 48.8 in January.

The benchmark Shanghai Composite Index surged 22.16 points, or 0.93 percent, to 2.403.59, and the Shenzhen Component Index settled at 9,862.53 points, climbing 166.66 points, or 1.72 percent.

Chinese shares got support from real estate developers in the morning session. Officials in Shanghai made an announcement that many saw as an expansion of the pool of people qualified to buy a second home to those who have lived in the city for at least three years, even if they do not hold a local household registration.

Banking and petrol and chemical sectors acted as drags to the market.

By the time markets closed, stocks in Shanghai-listed Poly Real Estate Group Co had risen 2.73 percent for the day to reach 11.28 yuan ($1.79) per share, while Shenzhen-listed China Vanke Co shares had jumped 3.41 percent to settle at 8.19 yuan per share.

Securities trading firms became the driving force behind bourses in the afternoon session, helping push the Shanghai Composite above 2,400 points to reach its highest point since the end of November.

Only the banking sector witnessed an overall drop in share prices Wednesday.

Analysts said the central bank's decision Tuesday to neither gain nor add capital to the market eased fears that liquidity would be further tightened, contributing to the gains in indices Wednesday.

The SME board jumped 110.84 points, or 2.42 percent, to close at 4,694.01; while the ChiNext settled at 759.56 points Wednesday, up 22.68 points or 3.08 percent.

The combined turnover of both the Shanghai Composite and Shenzhen Component rocketed to 217.2 billion yuan from Tuesday's 150 billion yuan. A-shares saw a net capital inflow of 8.7 billion yuan.