Indonesian share prices closed 2.79 percent higher on Friday, in line with firmer regional markets as investors reacted positively to a US Federal Reserve signal of a possible softening in its interest rate stance, dealers said.
After the sluggish trade of the past few weeks, Friday's pick up in prices and volumes suggested the market might be getting back on track, they added.
The Jakarta Stock Exchange composite index rose 35.519 points at 1,310.263 on volume of 1.846 billion shares worth 1.861 trillion rupiah (200.97 million dollars).
Advancers led decliners 99 to 23, with 52 stocks unchanged. The rupiah was firmer at 9,260-9,270 to the dollar against Thursday's 9,360-9,370. "Judging from the market's sharp rise as well as the increased volume it appears that investors have started to re-enter the market," said Luki Aryapama, an analyst with Panin Capital.
He said the Feds decision to increase its key federal funds rate by 25 basis to 5.25 percent was as expected. "But what was most important was that the Fed sent a positive signal" with regard to its rate stance, Aryapama said.
He said investors next week will monitor regional markets for leads and Monday's June inflation announcement as well as the central bank's board meeting the following week.
Among major stocks, telecom firm Telkom gained 400 rupiah to 7,350 while Indosat rose 150 at 4,275. Bank Rakyat Indonesia gained 250 to 4,100. Gas firm PGN was up 250 at 11,250 while carmaker Astra International added 250 at 9,750. Mining firm INCO fell 550 at 19,550 while rival Medco gained 25 to 3,725.
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