BUENOS AIRES, Dec 18 (Reuters) - Argentine stocks ended nearly flat on Tuesday after five straight sessions of losses, thanks to a last-minute rush on Petrobras stocks, while bonds rose as investors went bargain-hunting, traders said.
The MerVal index .MERV of the 25 leading stocks slipped just 0.07 percent to end at 2,125.67 points, hovering near a three-month low.
"The MerVal could not follow international markets higher because it was dragged down by sales ahead of the next options expiry" on Thursday, said Claudio Szlaien, an analyst at Marlon Recursos Financieros.
Brazil's Petrobras (APBR.BA) helped the market recover lost ground, gaining 2.2 percent to close at 162.5 pesos a share, while the company's Argentine arm, Petrobras Energia Participaciones PCH.BA, jumped 2.6 percent to 3.93 pesos.
"Investors are worried that greater inflationary pressure (in the United States) could halt the Fed's strategy of rate easings," said Roberto Drimer, an analyst at Argentine Research consultancy.
As U.S. inflation concerns grow, analysts say the Federal Reserve is unlikely to keep cutting interest rates. Lower U.S. interest rates tend to boost the allure of riskier but more profitable emerging market assets.
Government bond prices rose about 1 percent on average as investors took advantage of recent losses to buy paper at low prices in selective purchases, traders said.
The greatest gains were seen among Par bonds denominated in dollars, which rose 1.1 percent, and Discount bonds denominated in pesos, which rose 0.9 percent <AR/BONOS>.
The peso currency, which is regulated by the central bank, closed 0.08 percent stronger at 3.1350/3.1375 per dollar ARS=RASL in formal interbank trade.
In informal trade between foreign exchange houses, as measured by Reuters, the peso firmed 0.16 percent to end at 3.1575/3.1600 per dollar ARSB=. (Reporting by Walter Bianchi; Writing by Hilary Burke, Editing by Chizu Nomiyama)