Argentina stocks plunge after US court ruling on debt

GMT 12:35 2014 Monday ,16 June

Arab Today, arab today Argentina stocks plunge after US court ruling on debt

Buenos Aires Stock Exchange
Buenos Aires - AFP

Argentine stocks plunged Monday after the US Supreme Court rejected the country's appeal against having to pay hedge fund holders of its bonds, a decision that could pressure government finances.
The main index of the Buenos Aires market lost six percent shortly after opening after the Supreme Court effectively backed the hedge funds in their push for payment, despite refusing to take part in the 2005 and 2010 restructurings of the country's debt.
The Merval Buenos Aires index fell more than 530 points ,or 6.6 percent, to 7,513.27.
The dollar was up 0.4 percent to 11.70 pesos on the Buenos Aires black market.
The decision means that the hedge funds, which picked up Argentine bonds at an extreme discount after the country defaulted in 2001, will be paid 100 percent of the face value, at least $1.3 billion, even as the majority of creditors took a deep writedown of their bonds to help the country restructure its finances.
In court Argentina argued that such a ruling would force it back into default, although some analysts argue it can now afford to pay.

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