Investors took an optimistic view of the unprecedented $5.1 billion Solidarity Budget unveiled yesterday to help cushion the impact of the "circuit breaker" measures on the economy.
The improved sentiment sent the Straits Times Index (STI) up 81.3 points, or 3.4 per cent, to 2,470.59.
The best performer among the index's constituents was agribusiness firm Wilmar International, which gained 8.3 per cent to $3.40.
Among other stocks that recorded gains was CapitaLand, which advanced 4.6 per cent to $2.74. The firm announced yesterday it has reopened all its malls in China, which had been shut for several weeks amid the country's virus lockdown. Its residential and commercial arms are up and running as well, with healthy home sales figures clocked for last month.
Singapore banks, which were among the hardest hit last Friday on the back of rate slashes, also recorded gains. DBS Bank edged up 2.7 per cent to $18.40, UOB rose 3.6 per cent to $19.48 while OCBC Bank put on 3.9 per cent to $8.71.
All but two - ComfortDelGro and Singapore Press Holdings (SPH) - of the blue-chip index's 30 components ended in the black. ComfortDelGro fell 1.4 per cent to $1.41 while SPH declined 1.9 per cent to $1.55.
Gainers outpaced losers 300 to 121 for the day, with 1.51 billion shares worth $1.43 billion changing hands.
The STI's performance was in line with other Asian markets, with sentiment lifted as some countries reported falling death rates from Covid-19. These include China, which has been experiencing some economic recovery.
Philippine and South Korean stocks entered technical bull markets yesterday, rising over 20 per cent from the lows they reached just weeks ago.
Indonesian shares also climbed, advancing 4.1 per cent. Australia's benchmark index rose 4.3 per cent, Japan's Nikkei added 4.2 per cent while the Hang Seng in Hong Kong closed 2.2 per cent higher.
Markets in mainland China were closed for a public holiday.
But economists at Moody's Analytics said in a report yesterday that it will take time for domestic demand to return to pre-coronavirus levels, pointing out that foreign demand remains weak.
"Global demand is set to halt for much of 2020, which will likely prove to be China's biggest obstacle in its pursuit of a V-shaped recovery," noted the Moody's Analytics report.