Argentina stocks, bonds edge down on economy doubts

martes 12 de agosto de 2008 18:28 ART

(Updates with closing prices, fresh quotes)

By Jorge Otaola

BUENOS AIRES Aug 12 (Reuters) - Argentine bonds ended with light losses on Tuesday despite government purchases of locally traded debt a day after Standard & Poor's cut the country's sovereign debt ratings.

Bonds traded in Buenos Aires <AR/BONOS> were higher for most of the session, but closed down 0.2 percent on average in over-the-counter trade amid investor gloom over the ratings downgrade and July's inflation figure, which was even lower than expected.

"Bonds are feeling downward pressure due to sales by private investors who doubt the accuracy of the government's (inflation) figures, but the prices appear stronger due to purchases by state-run banks," said one debt trader.

The government started a debt buyback program on Monday, when daily newspaper Clarin said it spent $150 million.

The S&P ratings downgrade did not come as a surprise to the market, though it underlined concerns about the health of Latin America's No. 3 economy and its financing outlook.

The Economy Ministry says the country's economy remains solid, and Argentina has budget and trade surpluses after five years of robust growth.

However, it faces rising debt obligations in 2009 and prices for its top export earner, soy, have slumped recently.   Continuación...