July 16, 2008 / 9:26 PM / 12 years ago

Argentine stocks sag on dip in global oil prices

BUENOS AIRES, July 16 (Reuters) - Argentine stocks closed slightly lower on Wednesday as investors dumped energy-related shares after a fall in global crude oil prices.

The benchmark MerVal index .MERV fell 0.07 percent to close at 1,977.43 points, falling to its lowest level since January and bucking gains on regional markets.

Losses by index heavyweight Tenaris TENA.BA (TS.N), the world’s leading producer of seamless steel tubes for the industry industry and Brazil’s state-run energy company Petrobras APBR.BA(PETR4.SA) pushed the MerVal lower.

“The fall in Tenaris and Petrobras meant the MerVal didn’t get a boost from the rally on Wall Street,” said Marcelo Paccione, an analyst at ConsultCapital.

Tenaris shed 1.29 percent to 102.95 pesos, while Petrobras tumbled 2.56 percent to 95 pesos.

Crude oil prices dropped sharply for a second day on Wednesday, falling $4.14 to $134.60 a barrel after a U.S. government report showed a surprise increase in inventories and continued weak demand in the world’s top consumer nation.

The fall pushed the three major U.S. stock indexes up more than 2 percent.

Trading volume on the MerVal was a modest $31.5 million. Among active issues, 45 rose, 30 fell and 13 were unchanged.


Argentine bonds traded on the local market reversed recent losses to close higher in light trade.

Bonds rose 0.69 percent on average in over-the-counter trade, led by a 1.52 percent rise by dollar-denominated “Par” paper. Traders said buys from state-owned banks helped to boost bond prices.

On the foreign exchange market, the peso slid as investors awaited the outcome of Senate vote over a controversial soy tax hike that has triggered a long-running conflict between the government and farmers.

In formal interbank trade, where the central bank regularly intervenes, the peso ARS=RASL shed 0.08 percent to close at 3.025/3.0275 per dollar.

In informal trade between foreign-exchange houses, as measured by Reuters, the peso fell 0.65 percent to 3.0825/3.085 per dollar ARSB=.

Reporting by Walter Bianchi and Jorge Otaola; Writing by Kevin Gray; Editing by Diane Craft

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