Singapore shares closed 1.2 percent higher, as hopes grew that Europe would embark on fresh action to address its debt crisis while promoting growth.

As leading industrialized nations pledged to promote growth, markets were turning to a European Union summit on Wednesday, expected to focus on specific steps to spur growth and create jobs across the bloc. At Wednesday's informal European Union meeting, France's new president, Francois Hollande, is likely to propose consolidating European debt. The idea of bonds jointly underwritten by all Euro-zone member states could fend off contagion of funding difficulties from troubled Euro-zone economies, but Germany remains opposed.

OCBC Investment Research said "the market is actually more confident that Greece will try and tow the line and stay in the European Union, but things can change and change quite drastically. "

The benchmark Straits Times Index gained 33.59 points to close at 2,823.75 points. Trading volume was 2.19 billion shares worth 1. 12 billion Singapore dollars. Advancers outnumbered decliners 282 to 97, while 401 stocks closed unchanged.

GLP dropped 1 percent to 1.97 Singapore dollars. It said its 50- 50 joint venture with the Canada Pension Plan Investment Board is developing a 169 million US dollars logistics facility in Aikawa, Japan, which will be its third such development. The facility is expected to be completed in December 2013 and some 35 percent of it has been pre-leased to an existing customer.

ComfortDelGro inched up 0.3 percent to 1.48 Singapore dollars. The transport operator said its subsidiary had sold its entire stake in Shenyang ComfortDelGro Bus to Shenyang Metro Bus for 248. 35 million Chinese Yuan.

Armarda Group gained 3.4 percent to 3 Singapore cents, although it said it expects to report a loss for the 15 months ended March mainly due to low contributions from sales, certain impairments and an increase of expenses.

Bumitama Agri rose 0.6 percent to 89 Singapore cents. UOB Kay Hian Research initiated coverage of the company with a "Buy" rating and a target price of 1.10 Singapore dollars, saying that Bumitama's fresh fruit bunch production is poised to double in three years, driven by a 15 to 20 percent increase in mature areas every year, large young areas and progressive new plantings of 13, 000 hectares per year.

Among the top gainers, Jardine Strategic rose 2.2 percent to 32. 08 US dollars, while Sarin became one of the top losers by sinking 13.2 percent to 1.185 Singapore dollars. (1 U.S. dollar equals to 6.324 Chinese Yuan and 1.27 Singapore dollars)