SINGAPORE - Singapore stocks started the week off on a positive note. They rallied in line with the rest of Asia as bargain hunters jumped in on anticipation of further stimulus from central banks in China, Japan and Europe.
As at 12.35 pm on Monday, the Straits Times Index was up 1.58 per cent or 40.65 points to 2,617.74. Hong Kong surged 1.8 per cent, Taiwan was up 1.6 per cent, Shanghai and Shenzhen were up 1.03 per cent and 1.6 per cent respectively. Japan rose 0.7 per cent.
Banking counters led the rally, with DBS up 3.5 per cent or 49 cents to $14.36, OCBC up 2.6 per cent or 30 cents to $7.92 and UOB up nearly 3 per cent or 52 cents to $18.14. Also lifting local stocks was Singtel which jumped 2.3 per cent or eight cents to $3.54.
Market sentiment improved on prospects that ECB may unleash more stimulus and expectations that the Bank of Japan would need to ease monetary policy further in the near term are growing, analysts said.
"In the context of recent market volatility and developments in oil markets, the Fed is also expected to err on the dovish side at its policy meeting this week," Mizuho Bank said.
There are growing expectations that the timing for the first rate hike is now pushed back towards the second half of the year.
Oil rebounded towards US$32 a barrel, helped by comments from Saudi Arabia about low oil prices being "irrational" and winter storms in the US east coast.