November 26, 2008 / 8:58 PM / 12 years ago

Argentina stocks jump amid regional rally

(Adds details on stock movement; peso, bonds)

BUENOS AIRES, Nov 26 (Reuters) - Argentine stocks surged higher on Wednesday for a third straight day, tracking gains on Wall Street and in other regional bourses and responding to a rise in global grains prices, traders said.

The benchmark MerVal index .MERV ended up 5.34 percent at 954.81 points, accumulating a gain of 15.2 percent this week.

When the MerVal closed at 2000 GMT, Brazilian stocks .BVSP were trading 5.77 percent higher and the Dow Jones industrial average .DJI was up more than 2.0 percent.

“The improvement in commodities prices and the rise in U.S. and Brazilian stocks gave the market a late boost,” a trader said.

The MerVal’s gains were led by BBVA Banco Frances FRA.BA, whose shares jumped 15 percent to 2.99 pesos a share.

On the broad market, volume was a modest $27.7 million. Of active issues, 40 advanced, 17 declined and 10 were unchanged.

Meanwhile, locally traded government bonds gained 2.5 percent on average in over-the-counter trade, according to the ask price, in a fourth straight session of gains.

Trade was thin but prices were buoyed by a government plan unveiled on Tuesday that includes tax breaks to encourage Argentines to bring home funds they keep abroad to invest in bonds and infrastructure or other projects.

On the foreign exchange market, the peso weakened 0.30 percent against the dollar to 3.3475/3.35 ARS=RASL in formal interbank trade. The currency slipped 0.44 percent to 3.39/3.3950 per dollar ARSB= in informal trade between foreign exchange houses, as measured by Reuters.

The central bank intervenes in the foreign exchange market nearly every day to stabilize the peso’s value. (Reporting by Walter Bianchi and Jorge Otaola; Writing by Hilary Burke)

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