Argentina assets jump on Europe rescue plan rally
* Locally traded bond prices jump 1.8 percent on average
* Argentina's MerVal .MERV index surges 7.16 percent
* Risk spreads 11EMJ narrow 54 basis points (Updates with closing bond prices, adds stocks)
BUENOS AIRES, May 10 (Reuters) - Argentine bonds and stocks surged on Monday as an estimated $1 trillion rescue package for struggling European countries eased global risk aversion and boosted the outlook for Argentina's ongoing debt swap.
Argentina's country risk spreads narrowed 54 basis points to 724 basis points over comparable U.S. Treasuries, after having hit their highest level since February last week, when widespread fears about possible European defaults shook global markets.
Ask prices for locally traded Argentine bonds closed up an average of 1.8 percent on Monday, after having risen as much as 3 percent earlier in the session.
The dollar-denominated Bonar 2017 bond ARBONAR17D=RASL saw the biggest percentage increase in its ask price, surging 5.28 percent to 79.80.
A brighter outlook for riskier assets, thanks to the European rescue package, could boost Argentine efforts to swap $18.3 billion in defaulted debt and raise another $1 billion in the government's first global debt sale in eight years.
"This allows confidence and greater calm over the result of the debt swap," said Hernan Labrone, an analyst at Buenos Aires-based consulting firm Fenix Compania Financiera. Continuación...