Argentina stocks rose the most in two years in New York trading as some investors speculated the death of former President Nestor Kirchner will lead to a more-stable economy and reduced government spending.
The MSCI Argentina Index gained 10 percent to 3,458.64 at 10:58 a.m. New York time. It rallied as much as 13 percent, the steepest intraday advance since Nov. 24, 2008. Grupo Financiero Galicia SA, the South American country’s biggest consumer lender, surged as much as 26 percent.
Kirchner, who handed power to his wife Cristina Fernandez de Kirchner in 2007, died after suffering a heart attack, C5N television network reported today. Investors are buying Argentine American depositary receipts on prospects that “the Kirchner era” of high inflation fueled by public spending and low corporate investment may end, said Greg Lesko, who helps manage $750 million at Deltec Asset Management in New York.
“Stocks are going nuts,” Lesko said by telephone. “There is no guarantee that the next person will be any better but change is what the market has been wanting.”
Argentina markets, closed today for a public holiday, probably will rally as Kirchner was perceived as an obstacle to investment, Guillermo Mondino, head of Latin America research at Barclays Capital in New York, said in an e-mailed note.