Argentina stocks, bonds, peso fall on farm doubts

martes 22 de abril de 2008 17:58 ART
 

(Updates with close of markets)

BUENOS AIRES, April 22 (Reuters) - Argentine stocks and bonds fell and the peso currency slumped to a six-month low on Tuesday due to investor fears that farmers might revive protests as talks with the government stagnated.

"The losses of the MerVal (stock index) continue to be linked to the political problems between the farmers and the government, and the lack of short-term solutions that's affecting bond prices," said Horacio Corneille, a trader at the brokerage that bears his name.

In informal trade between foreign exchange houses, as measured by Reuters, the peso ARSB= sagged 0.46 percent to close at 3.2275/3.2300 per dollar, its weakest level since October.

But in formal interbank trade the peso slipped just 0.08 percent ending at 3.1800/3.1825 per dollar ARS=RASL, as the central bank sold dollars to stabilize the currency, traders said.

Argentina's huge agricultural sector staged a three-week protest over soy export taxes in March, causing food shortages and a major political crisis.

Farm groups agreed to end the strike and spend April in talks with the government, but leaders complained of a lack of progress on Tuesday, raising expectations that protests could start up again.

Argentine bonds <AR/BONOS> traded locally slid 1.785 percent on average, led by a 2.6 percent fall in the dollar-denominated Discount bond.

"The domestic fixed income market is still the most punished by the the higher uncertainty that's been around since the beginning of the conflict with the farm sector," Portfolio Personal consulting firm said in a report.   Continuación...