Argentine stocks fall on oil, farm protest worries

martes 27 de mayo de 2008 18:40 ART
 

BUENOS AIRES May 27 (Reuters) - Argentine stocks dipped on Tuesday, pulled down by a drop in global crude oil prices and investor uncertainty over a prolonged conflict between the government and farmers angry over a hike in export taxes.

The benchmark MerVal index .MERV fell 1.09 percent to close at 2,214.77 points.

Losses were led by index heavyweight and steelmaker Tenaris (TENA.BA: Cotización), the world's leading producer of seamless steel tubes for the energy industry and Brazilian state-run energy company Petrobras (APBR.BA: Cotización).

The fall in crude prices affected "the tendencies of Tenaris and Petrobras, which are heavily weighted on the MerVal," said Claudio Szlaien, an analyst at Marlon Recursos Financieros.

U.S. crude oil futures fell $4 on Tuesday, extending a slide as a stronger dollar and demand concerns kept pressure on oil prices.

Tenaris shed 1.63 percent to 96.8 pesos and Petrobras fell 7.25 pesos to 114.75 pesos.

Volume was a moderate $26.8 million on the broad market, where 64 issues declined, 43 advanced and 15 ended unchanged.

Traders were also closely watching a standoff between the government and farm leaders, who are locked in a two-month dispute over grains export taxes.

Farm leaders met to decide if they will launch their third strike in two months and hold back grains exports that are a key foreign currency earner.

Argentine sovereign bonds <AR/BONOS> fell on concerns about a renewed protest, shedding 0.5 percent on average on the domestic market, led by a 1.1 percent slide in the dollar-denominated Par bond.

Vigorous intervention by the central bank helped the peso currency gain 0.16 percent to 3.2075/3.21 per U.S. dollar ARSB= in informal trade between foreign exchange houses, as measured by Reuters. In formal interbank trade, the peso gained a centavo to 3.125/3.1275 per dollar ARS=RASL. (Reporting by Jorge Otaola; Writing by Kevin Gray; Editing by Dan Grebler)