(Updates with closing prices)
BUENOS AIRES, Sept 16 (Reuters) - Argentina's bonds and peso fell on Tuesday on concerns about financial turbulence in the United States, but stocks closed up after the U.S. Federal Reserve held interest rates steady.
"The Fed decision hit emerging market bonds more," said Marcelo Paccione, an analyst with ConsultCapital in Buenos Aires.
The benchmark MerVal stock index .MERV rose 0.61 percent to 1,571.78 after falling earlier in the day, but was still at levels not seen since June 2006. Volume was moderate at $24 million. Of active issues, 27 rose, 71 fell and 15 were unchanged.
The Molinos MOL.BA food processing company rose 9.8 percent to 8.40 pesos per share after it announced it would repurchase up to 250 million shares worth of stock.
Argentine bonds <AR/BONOS> fell 2.4 percent on average in local, over-the-counter trade.
The dollar-denominated Par bond ARPARD=RASL and the dollar Discount bond ARDISCD=RASL both slid 3.3 percent, according to the bid prices for each.
The peso slumped to its weakest level since late May as investors sold off their holdings to gain liquidity, traders said.
In formal trade between banks, where the central bank normally buys or sells dollars to keep the local currency steady, the peso was down 0.24 percent at 3.0925/3.0950 per dollar ARS=RASL.
In informal trade between foreign exchange houses, as measured by Reuters, it traded 0.79 percent weaker at 3.1625/3.1675 per dollar ARSB=. (Reporting by Jorge Otaola and Walter Bianchi; Writing by Hilary Burke; Editing by Jonathan Oatis)