UPDATE 4-Argentine markets fall post-default, NY hearing on Friday

jueves 31 de julio de 2014 18:23 GYT
 

* Argentine dollar Par bond falls 7.6 pct

* Unclear if credit default swaps will be triggered

* Latest debt crisis far cry from 2001-2002 crash (Adds Kicillof comment, timing of ISDA-facilitated committee vote on CDS, asset prices)

By Sarah Marsh and Richard Lough

BUENOS AIRES, July 31 (Reuters) - Argentina's bond and stock markets and peso currency dropped on Thursday after Latin America's No. 3 economy defaulted for the second time in 12 years after the failure of last-ditch talks with holdout creditors.

The default came after Argentina did not strike a deal with lead holdout investors NML Capital Ltd, an affiliate of Elliott Management Corp and Aurelius Capital Management, in time for a midnight Wednesday EDT (0400 GMT) payment deadline.

The government maintains that it has not defaulted because it deposited an interest payment on one of its bonds due 2033 that is governed by New York law. U.S. District Judge Thomas Griesa in Manhattan said in June when the payment was made that it was illegal because it violated his ruling.

At that time, Griesa deemed the $539 million deposit with the Bank of New York Mellon, Argentina's trustee bank, was illegal because it did not include a concurrent court-ordered payment of $1.33 billion plus accrued interest to the holdout investors.

Argentine Economy Minister Axel Kicillof warned on Thursday that the country could bring more lawsuits to challenge the contention that it is in default.   Continuación...