Jakarta. Indonesian stocks closed higher on Wednesday, tracking gains across much of Asia, as investors snapped up energy and commodity-related shares despite mounting concerns over rising inflation, a widening trade deficit and expectations of higher US interest rates.

The Jakarta Composite Index (JCI) climbed 0.92% to 5,695.1, recovering from the previous session's decline. As many as 391 stocks advanced, 263 fell, and 305 remained unchanged. Trading value reached Rp 10.25 trillion ($571.19 million), with 17 billion shares changing hands.

Energy stocks led sectoral gains, rising 2.61%, followed closely by basic materials at 2.6%. Infrastructure, consumer staples, technology, healthcare, and industrial shares also ended higher, while transport, financials, consumer discretionary, and property stocks declined.

Several small-cap stocks posted outsized gains, with shares of Wahana Interfood Nusantara (COCO) and CSM Corporatama (CSMI) surging between 23% and 34%.

Pilarmas Investindo Sekuritas attributed the rally partly to stronger regional equity markets, although investor sentiment remained tempered by expectations that the US Federal Reserve could raise interest rates following the release of US labor market data later this week.

Domestic macroeconomic data also painted a mixed picture. Indonesia's annual inflation accelerated to 3.34% in June, while monthly inflation reached 0.44%, driven by higher non-subsidized fuel prices and increased airfares during the school holiday season.

Separately, the country recorded its first monthly trade deficit in six years, with a $1.61 billion shortfall in May as soaring crude oil prices pushed the oil and gas deficit to $3.76 billion. The deterioration followed a near-balanced trade position in April and reflected higher energy import costs linked to disruptions in the Strait of Hormuz.

Across Asia, Japan's Nikkei 225 rose 0.6% while China's Shanghai Composite gained 0.4%. South Korea's Kospi fell 2%, and Australia's S&P/ASX 200 lost 0.6%. Hong Kong markets were closed.

Oil prices edged lower as investors monitored efforts to implement a ceasefire agreement involving Iran. Brent crude fell to about $72 a barrel, while US benchmark crude slipped below $69, easing concerns over immediate supply disruptions even as shipping through the Strait of Hormuz remained below pre-conflict levels.