January 28, 2008 / 9:25 PM / 12 years ago

Argentine stocks mirror Wall Street's gains

BUENOS AIRES, Jan 28 (Reuters) - Argentine stocks closed up on Monday after trading lower early in the session, mirroring gains in other global markets on hopes of a new interest rate cut by the U.S. Federal Reserve.

The MerVal index .MERV of 42 leading companies ended up 1.06 percent at 2,003.83 points, recovering from a 0.92 percent fall earlier in the day.

Investors remain very attentive to the possible approval of a stimulus plan to avoid recession in the United States and an expected decision by the Fed on Wednesday to lower interest rate again.

A new U.S. interest rate cut would ensure a capital flow toward riskier emerging markets where investors get better returns.

“We will follow very closely what is happening in the United States, with the clear, short-term trend tied to the Fed’s decision,” said Diego Zavaleta, a trader at the Besfamille brokerage.

On the broad market, volume was a weak $16.1 million; 31 issues advanced, 22 retreated and 24 remained unchanged.

Gainers were led by the energy distributor Metrogas MET.BA, which climbed 7.02 percent to close at 1.22 pesos, while Buenos Aires-listed shares of Brazil’s state-run oil company PetrobrasAPBR.BA climbed 5.15 percent to 173.50 pesos.

Argentine bonds <AR/BONOS> fell slightly on the domestic market, ending 0.4 percent lower on average, led by Boden 14 ARBODEN14D=RASL bonds denominated in pesos and dollars, which shed 0.5 percent.

The peso fell back slightly. In informal trade between foreign exchange houses, as measured by Reuters, the currency ARSB= yielded 0.16 percent, ending at 3.1825/3.185 per dollar.

In formal interbank trade, the peso ARS=RASL receded 0.08 percent to close at 3.15/3.1525. (Reporting by Jorge Otaola; Writing by Gaspard Sebag; Editing by Jonathan Oatis)

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