SE Asia Stocks -Indonesia at record high after rate cut; most others up ahead of holidays

BANGKOK, Feb 18 (Reuters) - The Indonesian key stock index

rallied to a record high on Wednesday amid optimism about the

domestic economy after an unexpected rate cut by the central

bank, while Malaysian shares snapped three days of gains in a

shortened trading session.

The Jakarta composite index was up about 1 percent

at 5,393.27, after climbing to an all-time high of 5,415.38.

Interest rate sensitive stocks led the gains, boosted by

foreign-led buying, Thomson Reuters data showed. Bank Rakyat

Indonesia jumped 3.3 percent and Bank Mandiri

advanced 2.6 percent, both hitting record highs.

Indonesia's central bank unexpectedly cut its benchmark

interest rate by 25 basis points to 7.5 percent after market

close on Tuesday.

The move officially ended Bank Indonesia's tight-bias cycle

which started in May 2013, while lower interest rates boded well

for domestic demand, broker Bahana Securities wrote in a report.

It upgraded its estimate for 2015 GDP growth to 5.45 percent

from 5.30 percent.

"While surprising, we applaud BI's looser monetary policy,

which we think indicates its efforts to support President

Jokowi's expansive fiscal policy this year, particularly given

expectations of subdued inflation on lower global oil prices,"

Bahana said.

Kuala Lumpur composite index ended the day down 0.1

percent amid weaknesses in financial shares. RHB Capital

dropped 2.8 percent, the worst performer on the index,

and Public Bank fell 1.3 percent, the third worst.

Data showed annual inflation in Malaysia fell to a more than

five-year low of 1.0 percent in January as oil prices skidded,

but economists do not expect the central bank to follow others

and respond by cutting interest rates.

Other Southeast Asian stock markets traded in positive

territory while Asian shares rose amid signs

Greek banks will continue to receive emergency funding despite a

breakdown in debt talks between Athens and euro zone finance

ministers.

The Thai SET index was up 0.7 percent, bouncing off

Tuesday's more than two-week closing-low.

Shares of retailer CP All rose 0.6 percent, their

first gain in four days, after the company reported a 23 percent

rise in quarterly earnings and said it planned to open new

stores in 2015.

Singapore shares finished the day 0.6 percent

higher, rebounding from a fall on Tuesday. Both Singapore and

Malaysia traded for half a day and will remain closed through

Friday for the Lunar New Year holidays.

Indonesia and the Philippines will be shut on

Thursday, while Vietnam will remain closed through Feb.

23.

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SOUTHEAST ASIAN STOCK MARKETS

Change at 0640 GMT

Market Current Prev Close Pct Move

Singapore 3435.66 3415.91 +0.58

Kuala Lumpur 1807.87 1810.09 -0.12

Bangkok 1598.54 1587.75 +0.68

Jakarta 5393.27 5337.50 +1.04

Manila 7827.33 7793.40 +0.44

(Reporting by Viparat Jantraprap; Editing by Anupama Dwivedi)