SINGAPORE – After several subdued years marked by thin liquidity and waning investor interest, 2025 will be remembered as the year Singapore’s stock market sprang to life and became one of the world’s best-performing stock markets. As at Dec 18, the Straits Times Index (STI) had risen almost 800 points in 2025, or about 21 per cent, a figure that would be much higher with dividends reinvested.
A confluence of global monetary easing, a strong defensive domestic reputation, decisive policy initiatives by regulators, a possible suspension of the tariffs threatened by the US administration and strong performances by heavyweight index constituents – mainly the local banks and Singtel – lifted sentiment, valuations and trading activity across the board.
While the Singapore Exchange (SGX) has not yet released a single consolidated statistic quantifying the exact increase in retail participation for the whole of 2025, multiple official disclosures, market reports and media coverage point clearly to a meaningful revival in retail investor activity during the year.
For instance, SGX chief executive Loh Boon Chye told shareholders at the exchange’s annual general meeting in October that retail participation had reached a three-year high, adding that retail investment in recent initial public offerings has “trended above the market average”.
Furthermore, retail-driven turnover in Singapore-listed exchange-traded funds rose by about 67 per cent year on year in the first half of 2025, suggesting growing engagement from individual investors seeking diversified exposure.
In trading platform Moomoo’s 2H2025 Retail Investor Sentiment Survey, more than seven in 10 investors said they considered Singapore stocks an integral part of their portfolios, adding that they intended to either maintain or increase their exposure in the coming months.
Taken together, these indicators show that retail investors played an increasingly important role in Singapore’s equity market in 2025. Their participation helped lift market liquidity, supported trading volumes during periods of volatility and contributed to renewed interest in domestic equities amid regulatory initiatives such as the $5 billion Equity Market Development Programme (EQDP).
In early April, the STI came close to crossing 4,000, only to be hit by a wave of selling triggered by the US government’s announcement of sweeping tariffs that stoked fears of a global slowdown.
The US has backed off on many of those tariffs while the US Supreme Court contemplates their legality, and the subsequent rebound on Wall Street has helped boost sentiment here.
On July 2, the STI closed above 4,000 for the first time ever at 4,010.77. Just four months later on Nov 11, it closed above 4,500 at 4,542.20. Since then, it has repeatedly notched new all-time highs, the most recent being 4,589.17 on Dec 15, firmly re-establishing Singapore as one of Asia’s best-performing developed markets.
While not all sectors shared equally in the rally, the overall narrative was clear: Confidence has returned.
A key external catalyst came from the United States. After more than two years of aggressive tightening, the US Federal Reserve began cutting interest rates in 2025, confirming what markets had long hoped for – that inflation was under control. The pivot marked a turning point not just for Wall Street but also for global capital markets.
Lower US rates eased pressure on emerging and developed markets alike, reduced the appeal of cash and fixed income, and encouraged investors to re-engage with equities. For Singapore, whose market had struggled to attract flows amid high global interest rates, the effect was particularly pronounced.
