Singapore shares closed 0.4 percent higher, as President Barack Obama declared a deal had been done to lift the government's borrowing limit and avoid a historic default.
U.S. Senate leaders hammered out an agreement to break the fiscal impasse late on Wednesday, paving the way for U.S. lawmakers to end the drama in Washington just hours before the government exhausts its borrowing authority. The Senate has passed the deal and sent the measure to the House of Representatives for final passage, before Obama signs it into law.
The deal, however, does not resolve the fundamental issues of spending and deficits that divide Republicans and Democrats. It funds the government until Jan. 15 and raises the debt limit through to Feb. 7, so global markets face the possibility of another showdown in Washington early next year.
OCBC Investment Research said "while global risk appetite may see a snap back in the short-term, it will be key to see if it can be sustained given that the deal is essentially 'kicking the can down the road' to early 2014."
CIMB Research said "the Straits Times Index failed at its 3,198 points and 3,220 points resistance band and quickly reversed. A retest cannot be discounted just yet."
Singapore's benchmark Straits Times Index rose 12.59 points to 3,186.62. Trading volume was 2.48 billion shares worth 1.09 billion Singapore dollars. Advancers outnumbered decliners 278 to 168, while 511 stocks did not move.
Asiasons Capital closed flat at 10.8 Singapore cents. It said on Thursday the Singapore Exchange believes it does not have a strong enough mandate for a share issue which it planned to finance the purchase of a 27.5 percent stake in Black Elk Energy Offshore Operations LLC, a U.S. oil and gas firm. The exchange's move has thrown into question whether the 171.65 million U.S. dollars' deal can go ahead.
Chasen Holdings jumped 11.3 percent to 17.7 Singapore cents. It announced that it had secured 7.1 million Singapore dollars worth of new contracts. These contracts also mark a new milestone for the Group's Relocation segment by being the first relocation project from the Middle East to Singapore and this paves the way for more projects in new countries.
CNA Group shed 1.5 percent to 13 Singapore cents. It has won over 8.5 million Singapore dollars in new projects in Asia. The new project wins include integrated building management system for Tanjong Pagar Centre, upgrading SCADA systems at Jurong Water Reclamation Plant -- inclusive of a five-year maintenance; and second airport project win in Laos.
Among top gainers, Jardine Matheson rose 1.6 percent to 55.48 U. S. dollars, while STXPO became one of the top losers by falling 5. 3 percent to 1.88 Singapore dollars. (1 U.S. dollar equals to 1.24 Singapore dollars)
