SINGAPORE - Banks, property heavyweights and Singtel continued to feel the love for a second straight session, driving the Straits Times Index up 1.57 per cent.
The STI closed up 44.81 points to 2,896.55, propelled by Singtel, which jumped 2 per cent or eight cents to S$4.03, and the banks. UOB gained 2.1 per cent, or 39 cents to S$18.65, DBS jumped 1.2 per cent or 18 cents to S$15.43, and OCBC rose 1.3 per cent or 11 cents to S$8.82.
Banks are back in favour after the Monetary Authority of Singapore announced last Friday it was fine-tuning the Total Debt Servicing Ratio (TDSR) rules to make it easier for borrowers with existing home loans to refinance their mortgages and pay off their debts at lower interest rates.
"This means more mortgage refinancing deals can be concluded now, which is good for banks and property stocks," remisier Alvin Yong said.
CapitaLand rose 2.2 per cent or seven cents to S$3.23, HongKong Land gained 1.8 per cent or 12 US cents to US$6.80, and City Developments jumped 3 per cent or 27 cents to S$9.23.
Singtel extended gains after UOB KayHian joined several brokerages in recommending buying Singtel "on weakness and its improved dividend yield as it is least affected by increased competition in Singapore" from a possible fourth provider.
Whether the feel-good effect can continue to drive the rally in local stocks will depend in part on whether there will be supply cuts or production caps achieved during the OPEC meeting later this month.
"Oil prices, according to some analysts, are starting to show signs of bottoming out. And the outcome of the OPEC meeting will be a catalyst for any upward surge in oil prices," Mr Yong said.
Local oil and gas counters rallied as Brent rose after Russia and Saudi Arabia pledged to cooperate to stabilize global markets.