Local shares rose in tandem with the rest of Asia on the back of a continued oil price rally and further signals that US interest rates will not rise this year.
The benchmark Straits Times Index rallied 1.75 per cent, or 51.47 points, to 2,998.50 - a rise of 7.4 per cent for the week.
"The continued low interest rate environment has a positive effect on property stocks and is also beneficial for commodities, which have regained some ground on a weaker dollar," remisier Alvin Yong said.
Blue chips Singtel, the banks, Keppel Corp and CapitaLand led the rally. Singtel jumped 2.1 per cent or eight cents to $3.85, OCBC rose 1.3 per cent or 12 cents to $9.39, UOB climbed 1.8 per cent or 36 cents to $19.89 and DBS gained 1.6 per cent or 27 cents to $17.69. Keppel Corp added 3.9 per cent or 28 cents to $7.44 and CapitaLand advanced 4.3 per cent or 13 cents to $3.15.
"For the rally to be convincing and seen as sustainable, the STI needs to clear 3,000, which is a very strong resistance level. That level is difficult to break because we are going into the third-quarter corporate earnings season, which is expected to be lacklustre," Mr Yong said. But he added that the STI could recapture the 3,000 mark if the positive sentiment continues and pushes the Dow Jones Industrial Average past 17,200.
A report yesterday by rating agency Standard & Poor's found that while a number of banking systems in emerging markets are "clearly vulnerable" to the sharp depreciation in their countries' currencies against the US dollar, Asia-Pacific banks "seem to be largely spared".
"We believe many banks in key Asia-Pacific markets have a sufficient cushion against the depreciation typically because of their low foreign currency exposure and hedging policies. We, therefore, don't believe that the credit profiles of major banks are under added strain. The effect of currency volatility on banks' corporate borrowers in most countries will have limited impact on the banking sector's asset quality," S&P said.
The most actively traded counter was Noble Group, which surged more than 16 per cent or 6.5 cents to 47 cents, with 245 million shares traded.
This came after the company, which has tumbled nearly 60 per cent this year after Iceberg Research and short-seller Muddy Waters questioned its accounting policies, announced new senior hires. It has also said that it is focusing on businesses that can deliver results immediately.
"The market views Noble's internal management restructuring as a favourable move," Mr Yong said.
The continued rally in crude prices further fuelled oil-related penny plays. Ezra Holdings gained 1.7 per cent or 0.2 cent to 12.2 cents, Ezion jumped 4.3 per cent or three cents to 73 cents and Rex International climbed 6.1 per cent or 0.6 cent to 10.5 cents.
