Argentine stocks bounce back after Trump comments trigger sell-off; peso dips

BUENOS AIRES, Oct 15 (Reuters) – Argentina's markets recovered on Wednesday from an unexpected dip a day earlier, sparked when U.S. President Donald Trump said his support for Argentina depended on President Javier Milei's party performing well in upcoming legislative elections. The peso weakened even as U.S. Treasury Secretary Scott Bessent announced another direct intervention in support of the currency. Trump's remarks Tuesday, made during Milei's visit to Washington, caused a widespread sell-off. The comments appeared to create uncertainty around official support from the current U.S. administration, which had previously announced a $20 billion currency swap with Argentina's central bank (BCRA). In response to the market's reaction, Milei's government clarified that it believed Trump's comments were directed at the 2027 presidential election, not this month's midterms. By mid-afternoon Wednesday, the S&P Merval, the main index of the Buenos Aires stock market, was up 4% after falling 2% the previous day. Sovereign bonds also rose by an average of 1.3%. International dollar bonds were little changed from Tuesday's decline. In the currency markets, the official wholesale peso weakened by 1.7% to 1,378 per U.S. dollar. Meanwhile, the widely watched parallel market rate, known as the "blue dollar," saw the peso trading at 1,435 per dollar. Futures contracts for the end of the year were priced even weaker, at 1,588 pesos per dollar. (Reporting by Walter Bianchi, writing by Brendan O'Boyle , editing by Rodrigo Campos and Diane Craft)

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