The index of the Indonesian Stock Exchange (BEI) rose 8.80 points or 0.16 percent to 5,435.27 points with index of 45 most liquid stocks up 0.34 percent to 945.52.
Analyst of Asjaya Indosurya Securities William Suryawijaya said the commitment of the government to prop up rupiah gave positive sentiment to the market.
"Hopefully the government policy would give confidence to the market players and relax the pressure on rupiah that would strengthen the market optimism with the countrys economic stability," William said .
Optimism of the market over the domestic economy would encourage expansion by publicly listed companies that would contribute to improving the countrys economic performance, he said.
The government has said it would issue a police package aimed at improving the countrys foreign trade balance and service account, which have been the main contributors to the countrys current account deficit.
William said he hoped that the US central bank, The Fed would not signal that it would raise its fund rate soon.
The Fed is to hold a meeting on March 17-18 , 2015 to set the date when it is to raise its fund rate. The Fed has been reported to raise its fund rate in the middle of this year.
HD Capitals analyst Yuganur Wijanarko said some of the market players began to buy shares on expectation that Bank Indonesia would cut its BI rate and optimism that issuers would have better financial report for the first quarter of this year.
"The sentiments circulating in the country keeps the JCI in a positive area early this week," Yuganur said.
Trade on Monday at BEI recorded 198,769 transactions with 3.69 billion shares valued at Rp4.09 trillion changing hands.
Decliners outnumbered gainers by 193 to 132 shares with 78 other shares remaining flat.
Regional markets such as Hang Seng and Straits Times recorded gain but Nikkei suffered a declin in index.
Meanwhile, rupiah in interbank transactions closed on Monday weaker trading at the level of 13,230 per US dollar from earlier level of 13,185 per dollar.
Chief researcher of Monex Investindo Futures Ariston Tjendra said external factors remained a drag on rupiah.
This week , the market players would focus attention to the result of a monetary meeting of the Fed on any sign of an increase in its fund rate, Ariston said.
"The expectation that the Fed would raise its fund rate keeps the US dollar in the positive territory over other currencies," he said.
However, the rupiah fall in value is still within control with the government plan to issue a a series of policy packages including on investment facility , fiscal incentive, anti dumping import duty to control import and greater use of biodiesel.
He said rupiah is expected to regain some of its lost value with the focus to cut the current account deficit.(*)
Editor: Heru Purwanto
Copyright © ANTARA 2015
