Indonesian share prices closed 1.37 percent higher for another record finish on Wednesday on fresh support for the banks, dealers said. The Jakarta Stock Exchange composite index added 18.152 points at 1,344.600, breaking its previous record high of 1,330.113 set on March 20.
Volume was 1.60 billion shares worth 1.60 trillion rupiah (178 million dollars). The rupiah fell back slightly to 9,010/9,015 to the dollar against 8,995/9,005 Tuesday.
"Banking stocks rose as they're the ones most affected by interest rates," said Panca Global Securities analyst Betrand Raynaldi.
Although Bank Indonesia indicated Tuesday that it would likely keep its monetary policy unchanged for now, investors remain confident interest rates will ease going forward, he said.
He said the drop in the Bank Indonesia three-month benchmark rate to 12.65 percent from 12.73 percent Wednesday's supported this notion.
The announcement of a lower-than-expected inflation rate for March and the rupiah's extended rally have also been fuelling hopes for a reduction in interest rates, the analyst said.
Among the day's top gainers were Bank Mandiri, up 60 rupiah at 1,740 and Bank Rakyat Indonesia, up 275 at 4,400. Bank Central Asia added 225 at 4,400.
Bank Niaga rose 20 to 500 while Bank Danamon was up 75 at 5,150.
Telkom advanced 50 to 6,950 while Indosat lost 50 to 5,200.
Car dealer Astra International was flat at 11,400.
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