June 17, 2008 / 8:33 PM / 12 years ago

Argentine stocks, bonds fall on farm crisis

BUENOS AIRES, June 17 (Reuters) - Argentine stocks slumped to a three-month low and bonds also slid on Tuesday after ex-President Nestor Kirchner gave a speech saying his wife’s government would not back down in a three-month conflict with the farm sector over soy export taxes.

The benchmark MerVal stocks index .MERV gave up 1.47 percent to 2,036 points, its lowest close since March 19. Volume was brisk at $48.5 million and of active issues 20 advanced, 57 declined and nine ended unchanged.

Grupo Financiero Galicia GFG.BA, which controls the country’s biggest bank, Banco Galicia, lost 4.81 percent to end at 1.58 pesos per share. Leading telecommunications company Telecom Argentina TEC2.BA eroded by 4.5 percent to 10.55 pesos per share.

“The MerVal’s big fall is based on bank and service issues because of the political problem between the agricultural sector and the government and because Kirchner’s speech didn’t show any conciliation,” said Francisco Marra of Bull Markets Brokers.

Government debt traded locally fell 2.2 percent on average in over-the-counter trade, with heavy selling of the most liquid bonds such as dollar-denominated Disc bonds, which slumped 4.1 percent.

In a nationally televised speech Kirchner, whose wife Cristina Fernandez is now president, defended her policies and said the government was not going to back down on a controversial export tax hike on soy, the country’s top crop.

Prolonged farmer protests over the tax have heightened political tensions in Argentina.

In the foreign exchange market, the peso ARSB= firmed 0.08 percent to 3.0350/3.0375 pesos per dollar in formal interbank trade ARS=RASL, as the central bank continued to sell dollars.

In informal trade between foreign exchange houses, as measured by Reuters, the peso weakened 0.16 percent to 3.1250/3.1275 per dollar ARSB=. (Reporting by Walter Bianchi and Jorge Otaola; Writing by Fiona Ortiz)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below