Argentine stocks and bonds rose on Friday after tame US inflation data quelled worries that the US Federal Reserve would have to hike interest rates. The MerVal index of 16 leading stocks gained for a third consecutive session, surging 1.07 percent to 2,216.58 points.
On the broad market, volume was heavy at $40 million, with 53 advancing issues, 15 declining and 17 unchanged. Financial group Financiero Galicia, owner of one of the country's biggest banks, was the session's volume leader by value, rising 0.97 percent to 3.12 pesos. Capital Markets Argentina brokerage revised its price objective on Group Financiero Galicia to 3.7 pesos from 3.52 pesos.
The dollar-denominated Par bond jumped 3.7 percent in over-the-counter trade, while dollar Discount bonds on the Buenos Aires Securities Exchange rose 1.7 percent. Argentine bond prices on the local market had slumped most of this week as the yield on the benchmark US Treasury note jumped to five-year highs. Higher yields on US debt make emerging market debt less attractive for investors.
"The market improvement is being moved basically by external factors, the calming US inflation data," said Diego Zavaleta, a trader with Besgamille brokerage. In informal trade between foreign exchange houses, the peso currency closed flat for a fourth day in a row at 3.0950/3.0975 per dollar.