Argentine markets swoon on global finance turmoil

viernes 10 de octubre de 2008 18:30 ART

(Updates with central bank source)

BUENOS AIRES Oct 10 (Reuters) - Argentine stocks fell to their lowest level since December 2004 on Friday, while bonds and the peso slumped despite central bank intervention in the foreign exchange market.

"People don't want to take any risks and with this uncertainty in the markets, they want to put their assets into dollars," said one currency trader.

Traders said the bank had sold more than $500 million worth of dollars to prop up the peso, but a central bank source said a far less was required to limit the local currency's slide.

Jose Nogueira, an analyst at ABC Mercado de Cambios, said the central bank sold $539 million worth of dollars during the session, but the source said it had sold $160 million and later bought back $100 million.

In informal trade between foreign exchange houses, as measured by Reuters, the peso closed down 1.2 percent at 3.36/3.37 per U.S. dollar ARSB=, after trading as weak as 3.40/3.45 just after the market opened.

In formal trade between banks ARS=RASL, where the central bank intervenes directly, the peso closed 0.31 percent firmer at 3.2200/3.2225 per dollar, after slumping to 3.2725/3.2750 earlier in the session.

The benchmark MerVal index .MERV shed 5.5 percent to 1,215.99 points for a seventh consecutive loss. It sank by as much as 10 percent earlier in the session.

Over the last seven sessions of trade the MerVal has fallen 24 percent.   Continuación...