Argentine stocks get oil lift; bonds lackluster

miércoles 27 de agosto de 2008 17:39 ART

BUENOS AIRES Aug 27 (Reuters) - Argentina's benchmark stock index on Wednesday rose as higher oil prices lifted energy shares, while bonds barely reacted to a government buyback auction aimed at strengthening prices.

The MerVal index .MERV ended 1.11 percent higher at 1,779.74 points. Volume was moderate at $36 million. Of active shares 35 advanced, 27 declined and 16 were unchanged.

Tenaris (TENA.BA: Cotización), which makes steel pipes for the oil industry, jumped 4 percent to 84.8 pesos per share, a two-week closing high. Tenaris is weighted as 14 percent of the MerVal.

"Crude prices are again pushing Tenaris and Petrobras, which is driving the MerVal up," said Claudio Szlaien, analyst with Marlon Recursos Financieros in Buenos Aires.

U.S. crude oil futures rose for a third session on Wednesday to $118.15 per barrel, due to bad weather in the Gulf of Mexico that could threaten production.

Argentine sovereign debt prices rose 0.2 percent on average in local trade, led by a 1.6 percent gain in the Bonar 2013. The government offered on Wednesday to buy back up to $48.9 million in bonds as part of a plan to buoy debt prices.

"The amount of the buyback is really small, but even if it had been bigger it wouldn't have mattered. The market is following a different track, the buyback is meaningless if it it isn't done with additional economic measures," said Christian Reos, analyst with Allaria Ledesma y Compania brokerage.

Argentine bond prices have been hit in recent weeks by concerns that the government might face a financing squeeze next year.

The peso closed unchanged for a second session in a row, at 3.02500/3.0275 per dollar ARS=RASL in interbank transactions and 3.0675/3.0700 ARSB= in informal trade between foreign exchange houses. (Reporting by Walter Bianchi and Jorge Otaola, writing by Fiona Ortiz; Editing by Leslie Adler)