November 12, 2008 / 9:06 PM / 12 years ago

Argentina stocks skid on global economy worries

BUENOS AIRES, Nov 12 (Reuters) - Argentine stocks tumbled for a fourth straight session on Wednesday, sliding on investor concerns the global economy is heading into a recession, while the peso and bonds also fell.

The benchmark MerVal index .MERV plunged 5.49 percent to 1,008.26 points. Volume on the broad market was a slack $18 million.

“What’s happening externally continues to affect the MerVal,” said Juan Diedrichs, an analyst at Capital Markets Argentina.

Locally-listed shares of Brazil’s state-run energy company Petrobras APBR.BA fell 16.3 percent to 41.8 pesos on investor concerns over lower crude prices.

Tenaris TENA.BA, a leading global maker of steel oil drilling equipment that is weighted as 20 percent of the MerVal, dropped 1.1 percent to 39.7 pesos.

U.S. stocks continued their slide on Wednesday as the Bush administration backed away from its initial plan of using a $700 billion bailout to buy up bad mortgages.

U.S. shares were also hit after the country’s top electronics retailer, Best Buy BBY.N, warned the business climate was the worst in 40 years, adding to recent economic gloom.

Worries about the U.S. and world economies also spread to locally traded Argentine bonds, which fell by 1.8 percent on average, accumulating a loss of 5.8 percent so far in November.

Dollar-denominated Par bonds ARPARD=RASL shed 3.7 percent and Disc bonds in dollars ARDISCD=RASL lost 3.2 percent.

On the foreign exchange market, the peso closed lower, its slide partially offset by intervention by the central bank.

The peso currency weakened 0.15 percent to 3.3025/3.305 per dollar ARS=RASL in formal interbank trade but fell 1.5 percent to 3.37/3.38 ARSB= in informal trade between foreign exchange houses as measured by Reuters. (Reporting by Walter Bianchi and Jorge Otaola; Writing by Kevin Gray)

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