Indonesian share prices closed 2.5 percent lower on Wednesday on continued profit-taking amid rising concerns that next month's fuel price hikes could put additional pressure on inflation, dealers said.
The Jakarta Stock Exchange composite index lost 27.117 points at 1,058.627 on volume of 1.26 billion shares worth 1.25 trillion rupiah (123.7 million dollars).
The rupiah firmed to 9,995/10,005 to the dollar compared to Tuesday's level of 10,070/10,080, reflecting expectations interest rates may have to rise further.
"Basically our market isn't that cheap anymore," said Indo Premier Securities analyst Suherman Santikno, with profit-taking inevitable after recent sustained gains.
With Bank Indonesia's key interest rate still high, investors may have withdrawn their funds from the stock market and put them in Bank Indonesia Certificates (SBIs), he added.
In Wednesday's auction, the central bank kept its key interest rate for the one-month SBI at 10 percent.
Dealers said the government's plans to raise fuel prices as early as next month added to the selling pressure, as companies face increased production costs.
Telkom lost 250 rupiah to 5,050 and Indosat shed 100 rupiah to 5,100. Car dealer Astra International dropped 400 rupiah to 10,650 and its heavy machinery unit United Tractors fell 50 to 3,825. Cigarette firm Gudang Garam was down 500 rupiah at 10,900. Bank Central Asia dropped 125 rupiah to 3,400 while Bank Danamon gained 25 to 4,300. State-owned Bank Mandiri lost 40 rupiah to 1,390 and Bank Rakyat Indonesia was down 75 at 2,675.
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