Signs that US President-elect Joe Biden's transition to the White House is well under way and developments that bode well for coronavirus vaccines are driving a rally in stock markets across the world.
Following an overnight surge that saw the Dow Jones benchmark crack 30,000 for the first time in history, several Asian markets continued to rise, while others paused to book profit.
The renewed demand for shares pushed MSCI's broadest gauge of world stocks to a record high of 622.12.
Japan's Nikkei Stock Average rose 0.5 per cent to a 29-year high, while Thailand and Malaysia were up more than 1 per cent.
Hong Kong also rose 0.3 per cent, though the Straits Times Index (STI) took a breather, giving up 0.76 per cent after having gained 17.5 per cent since the start of this month.
"The fear of missing out is amplifying the rally in the stock markets. Buy first, ask later," CIMB Private Banking economist Song Seng Wun said.
He pointed out that the STI had lost 20 per cent from January until this month, when it started rising. Until that point, it had been the second worst performer in Asia this year, after Thailand.
"(Yesterday's) bout of profit taking is a healthy breather. Investors are just taking money off the table after a very good rally," he added.
The rally for global stocks is set to continue for at least six months, according to a Reuters poll forecast yesterday.
"The world is going to look a lot better this time next year than it does now, and that's what equity markets are reflecting," JP Morgan Asset Management global market strategist Mike Bell told Reuters.
Global energy shares have risen almost 34 per cent so far this month, on track for their best month on record as crude prices rally. Oil prices held near their highest levels since March on the improved global economic outlook. Brent futures were up 1.2 per cent to US$48.42 per barrel, touching a high last seen in March.
In the Singapore stock market, institutional investors have been net buyers of nearly $1.17 billion worth of shares in the past three weeks, compared with during the first 10 months of this year when they were net sellers of nearly $7.1 billion worth of shares.
Singapore stocks' valuations have also become more "compelling" amid a slew of positive news, said Morgan Stanley.
Said Mr Song: "This year is the pandemic year, but next year is the vaccine year. If there is less friction on the global trade stage with a less confrontational US government, we could be looking at a faster global recovery."
Markets are also cheered by Mr Biden's nomination of former Fed chairman Janet Yellen as his Treasury secretary, and she may work with current chairman Jerome Powell in unleashing US fiscal and monetary stimulus to foster a swifter recovery, DailyFX.com strategist Margaret Yang said.
"Markets appeared to have looked past current headwinds into future recovery stories... in favour of cyclical industries - energy, materials, financials, airlines and industrials. Stock prices of these traditional industries are still far from reaching their pre-Covid levels, suggesting that the vaccine-rally may have further room to go," she said.
Mr Song said: "The markets have shrugged off the spike in Covid-19 cases worldwide and are banking on hopes of vaccine success. Don't stand in front of that train."
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