14th September 2012

Singapore shares surged Friday amid a broad Asian rally after the U.S. Federal Reserve announced an open-ended bond-buying program to boost the American economy.

"The Fed's blank check was enough to send all prices higher. This means 'risk on,' at least for now," UOB Economic-Treasury Research said in a note. But "one cannot help but wonder what would happen when this Dickensian market goes 'please sir, I want some more.'"

The 30-share Straits Times Index rose 1.3%, or 40.28 points, to close at 3070.42--its highest closing level since Aug. 6. For the week, the benchmark index ended 1.9% higher. In the broader market, volume climbed to 2.39 billion shares compared with 1.47 billion shares traded Thursday. Gainers outnumbered decliners 406 to 112.

DBS Vickers expects the benchmark index to gradually work toward 3200 in the fourth quarter, with 3050 and 3075 the two immediate levels to watch. While the STI may underperform the region, DBS Vickers said that "opportunities can be found among the cyclical stocks" such as commodity and offshore and marine names.

Commodity counters led the blue-chip charge, in which all but three STI components ended higher. Wilmar International soared 8% to a one-month high at S$3.24 while Noble Group climbed 5.5% to S$1.35--its highest close since April 4. Olam International, too, hit a one-month high, rising 5.1% to S$2.08. Golden Agri-Resources gained 3% to end at S$0.690.

Property plays also pushed higher, many of them reversing losses suffered Thursday. Hongkong Land led the way with a 2.2% rise to US$6.10 while City Developments added 2% to end at S$11.40. CapitaLand ended up 1% at S$3.18.

Singapore's two main rig builders rose to near-four week highs with Sembcorp Marine advancing 1.8% to S$5.08 and rival Keppel Corp. closing 1.2% higher at S$11.32.