BANK INDONESIA RATE CUT DRIVES STOCK INDEX UP

Jakarta, Dec 4 (ANTARA) - A decision made by the Indonesian central bank to cut its rate caused the Jakarta Stock Exchange index to close 1.07 percent higher on Thursday.

The index rose 12.798 points to 1,205.324. The LQ45 index meanwhile increased 4.347 points or 1.90 percent to 233.434.
Research analyst of PT Asia Kapitalindo Sekuritas. Harry Kurniawan, said to ANTARA the Bank Indonesia's decision to cut the key rate had affected share trading.
The board of governors of the central bank on Thursday decided to cut the BI Rate by 25 basis points to 9.25 percent.
The decision made several banking and other top stocks that are sensitive to interest rate changes rose.
Among the banking stocks that increased were Bank Mandiri which were up Rp110 to Rp1,600, Bank BRI up Rp250 to Rp3,450, Bank BCA rising Rp75 to Rp2,750 and Bank BNI increasing by Rp30 to Rp500.
Expectations for a cut in the BI rate had been the driving factor behind the rising of the banking shares in addition to the rise in the exchage rate of the country's rupiah currency that appreciated a little to Rp11,875 against the US dollar, he said.
Harry said commodity shares particularly plantations-based commodity shares also rose. "Indications of an increasing demand in the commodity (CPO) sector in 2009 have driven the plantation company shares to rise," he said.
Several commodity shares that rose were Bakrie Plantation which were up Rp20 to Rp230 and London Sumatra which were up Rp50 to Rp2,575. Mining shares also rose namely Bumi Resources which increased Rp40 to Rp810, Tambang Batubara Bukit Asam, up Rp250 to Rp6,350 and Timah up Rp60 to Rp1,060.
Gaining shares dominated trading reaching 70 compared to losing stock totalling 56. Fifty-four stocks meanwhile were stagnnat while 276 others were not actively traded.
The volume of trading that day reached 1.475 billion shares valued at Rp1.09 trillion in 38,076 transactions.