* Stocks .MERV open up 1.1 percent, peso dips
* Locally traded bonds rise an average 4.0 percent
By Jorge Otaola and Walter Bianchi
BUENOS AIRES, Oct 28 Argentine bonds and stocks
rose in opening trade on Thursday, boosted by investor
confidence a day after the death of former President Nestor
For more on Kirchner see [ID:nN28110442].
Investors had disliked the unorthodox economic policies of
Kirchner, who was a key power broker in the current government
of his wife, President Cristina Fernandez, and who had been
expected to run for a second term in October 2011 elections.
"The rise in stocks and bonds reflects expectations for a
shift to economic policies that are more closely aligned with
the markets," said Roberto Drimer, an analyst for VaTnet
Locally traded Argentine bonds <AR/BONOS> rose 4.0 percent
on average in opening trade. Among the biggest gainers was the
dollar-denominated Disc ARDISCD=RASL, which rose 6.2 percent
to an ask price of 94.60.
Argentina's portion of the JP Morgan EMBI Plus sovereign
bond index 11EMJ widened 2 basis points to 535 basis points,
after reaching its tightest in 31 months earlier in the
session. The index overall was 1 basis point tighter.
The benchmark MerVal .MERV stock index was up 1.43
percent at 2,962.27 in morning trade boosted by speculative
buying, with gainers led by media group Grupo Clarin
(CLA.BA)(GCSAq.L), which was up 34 percent at 19 pesos per
The government has been battling with Clarin for more than
two years. Kirchner frequently accused it of trying to
destabilize his wife's administration while the media group in
turn accuses officials of a campaign of harassment.
On the foreign exchange market, the peso weakened 0.12
percent to 4.0350/4.0400 per U.S. dollar ARSB= in informal
trade between foreign exchange houses, as measured by Reuters.
In formal interbank trade, the peso was down 0.06 percent
at 3.9575/3.96 per dollar ARS=RASL.
Market sources said they do not expect sudden movements on
the peso due to the central bank's policy to continue
intervening in foreign exchange markets and accumulating
foreign reserves. [ID:nN25268824]
(Writing by Luis Andres Henao; Editing by James Dalgleish)