May 9, 2008 / 9:11 PM / 12 years ago

Argentine stocks rise on safe-haven buying

BUENOS AIRES, May 9 (Reuters) - Argentine stocks bucked the downward regional trend on Friday because of safe-haven buying triggered by a prolonged farming conflict and a further weakening of the peso, traders said.

The MerVal index .MERV of leading stocks closed up 0.59 percent to 2,114.44 points, accumulating a gain of 0.32 percent over the course of the week despite jitters over renewed anti-government protests.

“The MerVal steered away from the global losses because a variety of rumors drove investors to look for refuge in stocks,” said Ruben Pascuali, a trader at the Mayoral Bursatil brokerage.

Volume on the broad market swelled to a moderate $32 million and of active issues, 47 advanced, 24 declined and 11 were unchanged.

“Against the backdrop of uncertainty, investors found the best refuge in Petrobras Energia Participaciones PCH.BA,” Pascuali said.

Stock in the energy firm, the Argentine arm of Brazilian state oil company Petrobras, closed up 3.83 percent to 4.33 pesos per share after it reported a higher first-quarter net profit.

Farmers lined highways for a second day on Thursday in fresh protests against a sliding-scale of grains export taxes that triggered a three-week farm strike in March.

Jitters over the dispute fueled dollar purchases, sending the Argentine peso lower for a fourth straight session. In informal trade between foreign exchange houses, as measured by Reuters, it depreciated by 0.46 percent to 3.265/3.27 per dollar <ARSB=.

However, in formal interbank trade — where the central bank intervenes in the market to keep the currency stable — the peso firmed by 0.08 percent to 3.175/3.1775 per dollar ARS=RASL.

Fresh farming protests continued to feed the cautious mood in the debt market, with locally traded bonds <AR/BONOS> falling by 0.2 percent on average due to profit-taking of gains racked up earlier in the session.

Peso-denominated Discount bonds fell 0.4 percent in over-the-counter trade while the same bond in dollars rose by the same margin.

Expectation over the release of the April inflation figure — 0.8 percent — also caused caution. More than 40 percent of Argentina’s debt load is indexed to inflation. (Reporting by Walter Bianchi; Writing by Helen Popper; Editing by Diane Craft)

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