Argentina Stocks, Bonds Rise Amid Govt Debt Plan Speculation

 
   By Matthew Cowley 
   Of DOW JONES NEWSWIRES 
 

BUENOS AIRES (Dow Jones)--Argentine stocks and bonds moved higher Thursday amid speculation that the government would reopen its 2005 debt restructuring.

The Merval stock index was up 2.3% at 2,309 points, while the sovereign Discount bond in pesos was up 5.1% at 104 to yield 11.77%.

Afternoon trading was buoyed by speculation that the government later Thursday will reopen the country's mammoth 2005 debt swap.

A spokesman for the Economy Ministry said earlier that the minister will make an "important announcement" later Thursday at a press conference, but didn't say what the press conference would be about.

Speculation has been mounting for weeks that the government will soon reopen the debt swap to attract investors holding $20 billion in face value of defaulted bonds that weren't included the first time around.

The dollar-denominated Boden 2012 was up 2.3% in price terms at ARS317, to yield 12.43%.

In the stock market, banks led the way as they're seen as the most direct beneficiaries of any move made by the government to resolve its defaulted debts. Many of them own large amounts of government bonds.

Grupo Financiero Galicia SA (GGAL, GGAL.AR) was up 9.7% at ARS2.26, while Banco Hipotecario (BHIP.AR) was up 9.6% at ARS1.49.

Utilities were losers Thursday, with electric power distributor Edenor (EDN) was down 3% at ARS1.6.

The peso closed unchanged at 3.8225 to the dollar, where it has remained stuck all week due to heavy Central Bank intervention to support the greenback.

-By Matthew Cowley, Dow Jones Newswires; 54-11-4103-6740; shane.romig@dowjones.com

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(END) Dow Jones Newswires

October 22, 2009 16:54 ET (20:54 GMT)


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