Argentine stocks, bonds rally on debt swap hopes

lunes 5 de abril de 2010 17:16 ART

* MerVal stock index hit record on oil prices, debt swap

* Argentine country risk tightens on swap acceptance hopes

* Locally traded bonds close up by 1 percent on average

BUENOS AIRES, April 5 (Reuters) - Argentine bonds and stocks rose on Monday and the country risk narrowed to its tightest since July 2008 on expectations for a high rate of acceptance in a planned swap of up to $20 billion in defaulted bonds.

Locally traded bonds <AR/BONOS> closed up 1 percent on average as investors continued to buy sovereign debt in the run-up to the exchange, which is set to launch on April 14.

Analysts think investor acceptance could reach about 80 percent, higher than the government's target for 60 percent.

Dollar-denominated Boden 2014 bonds ARBODEN14D=RASL rose 2.5 percent to an ask price of 33.30. The 2033 Discount bond in dollars ARDISCD=RASL gained 2.2 percent to an ask of 77.65.

The spread between the yield on benchmark Argentine bonds and on comparable U.S. Treasuries narrowed 37 basis points to 609, according to the JP Morgan Emerging Markets Bond Index 11EMJ.

Positive investor sentiment over the debt swap lifted banking stocks, helping the benchmark MerVal stock index .MERV climb 3.19 percent to a record high of 2,449.53.   Continuación...