Shares end at new high on interest rate hopes

Shares end at new high on interest rate hopes

Dow Jones Jakarta

Shares ended at a record high on Friday on hopes for a further fall in interest rates, dealers said.

Bank Indonesia notes fell to an all-time low of 8.06 percent from 8.24 percent in a weekly auction on Wednesday, with analysts predicting rates will fall further amid easing inflationary pressure and ample liquidity among banks.

The Jakarta Stock Exchange Composite Index ended up 6.881 points, or 0.9 percent, at 770.334, slightly off an all-time intraday high of 771.288.

Gainers led decliners 89 to 48, with 86 stocks unchanged.

Volume was 2.75 billion shares valued at Rp 1.2 trillion (US$143.88 million).

Bellwether Telekomunikasi Indonesia (Telkom) led gainers, rising Rp 150, or 2.1 percent, to Rp 7,450 on hopes of higher revenue this year due to an increase in the number of its cellular phone subscribers.

Dealers said investors bought shares of cement companies since lower interest rates are expected to help boost the property sector.

Semen Gresik rose Rp 50, or 0.6 percent, to Rp 9,100; Indocement Tunggal Prakarsa gained Rp 100, or 4.2 percent, to Rp 2,500; and Semen Cibinong was up Rp 5, or 1.2 percent, at Rp 425.

Cigarette maker Gudang Garam extended gains, rising Rp 300, or 1.9 percent, to Rp 15,900 on hopes of higher sales this year.

Shares of tin miner Timah fell Rp 150, or 6.1 percent, to Rp 2,300, and gold and nickel producer Aneka Tambang dropped Rp 125, or 7.1 percent, to Rp 1,625 on profit-taking.

Dealers said they expect the market on Monday to trade flat to slightly higher, with profit-taking in select blue chips likely to cap gains.

Separately the rupiah ended slightly higher on Friday on the local stock market's sustained rally to a fresh all-time closing high.

The dollar closed at Rp 8,355, down slightly from its close on Thursday at Rp 8,365.