The local bourse did not let up on its new year merry-making, cheering Wall Street's grand 2018 start and recent upbeat macro data both at home and abroad.
The benchmark Straits Times Index (STI) climbed 34 points or 1 per cent to finish at 3,464.28 yesterday, led by sweet gains in banking stocks, which outperformed regional peers.
The gains came ahead of the release of the United States' Federal Open Market Committee meeting minutes, which are expected to provide some assessment on the inflation outlook in the US.
An uplift came from Wall Street after it began the new year hitting fresh highs - the Dow rose 0.42 per cent, while S&P 500 gained 0.83 per cent and Nasdaq 1.5 per cent.
The cheer seemed widespread, with key regional bourses also reflecting improved risk appetites. Hong Kong's Hang Seng gained 0.2 per cent to a fresh-decade high, China's Shanghai Composite rose 0.6 per cent while South Korea's Kospi inched up by 0.3 per cent.
The optimism was sparked by better-than-expected manufacturing data from China and the euro zone, signalling that growth is likely to remain healthy in 2018.
Strong advance gross domestic product (GDP) figures for Singapore led equities here to a grand start. The fourth-quarter GDP figure beat market expectations again and was driven mainly by healthy output expansion in the electronics and precision engineering clusters because of strong overseas demand. Singapore registered a full-year growth rate of 3.5 per cent in 2017, more than double initial forecasts.
"The Singapore stock market had a fruitful year in 2017, and the upward momentum could carry on in 2018 should crude oil price continue to go up and fundamental elements stay robust," said CMC Markets Singapore analyst Margaret Yang Yan.
Based on the current bullish follow-through, Phillip Capital said the index could ultimately test the 2015 high of 3,549. "As long as the 20-and 60-day moving average holds, the STI should continue to stair-step higher," said the house based on the technical reading.
DBS led the gains, advancing 68 cents or 2.7 per cent to $25.88. OCBC rose 21 cents or 1.7 per cent to $12.70 while United Overseas Bank jumped 27 cents or 1 per cent to $26.90.
Midas Holdings surged 4.8 cents or 43 per cent to 15.9 cents. It announced that a joint venture has clinched 2.68 billion yuan (S$547.9 million) of metro train car supply contracts in China.
