SINGAPORE - Markets across the region bounced back on Tuesday as traders cheered the International Monetary Fund's decision to include the Chinese yuan in its elite basket of currencies.
The move is widely expected to help reduce volatility in the currency.
Singapore stocks were not left out of the rally, although the gain was modest.
The benchmark Straits Times Index inched up 14.32 points, or 0.5 per cent, to 2,870.26.
Hong Kong led the region-wide rally with a 1.8 per cent jump, lifted also by official Chinese data that showed manufacturing drop to the lowest in three years.
"The PMI was worse than expected, so this may prompt more stimulus," Mr Mikio Kumada, a Hong Kong-based global strategist at LGT Capital Partners, told Bloomberg.
"The seasonal pattern always favours equities toward the end of the year."
Tokyo rose 1.3 per cent, while Shanghai held steady, adding 0.3 per cent after two volatile sessions as the authorities launched regulatory probes on major brokerages.
Seoul gained 1.6 per cent, Sydney grew 1.9 per cent and Jakarta jumped 2.5 per cent.
Wall Street dipped 0.4 per cent overnight, as investors readied themselves for the European Central Bank meeting on Thursday - which could spell further quantitative easing policies to stimulate the economy - as well as the November jobs report on Friday.
At home, commodity trader Noble Group was among the day's biggest winners, rising half a cent or 1.2 per cent on its fourth straight day of gains to 43 cents.
It was also the most active counter with 50.9 million shares changing hands.
Logistics facilities provider Global Logistic Properties also performed well, chalking up a five cent or 2.5 per cent increase to S$2.02.
The local banks were a mixed bag, with United Overseas Bank edging up six cents or 0.3 per cent to S$19.45; DBS Group Holdings climbing five cents or 0.3 per cent to S$16.55; and OCBC Bank unchanged at S$8.67.
On the other side of the ledger, Golden-Agri Resources, the world's second largest global palm oil producer, led losses among the blue chips, sliding half a cent or 1.4 per cent to 35.5 cents.
Ground handling and in-flight catering provider Sats dipped one cent or 0.3 per cent to S$3.94.
Trade on the exchange came up to 994 million units worth S$1.02 billion.
