(Adds details on sector composition, index performance,
background on Argentina)
BUENOS AIRES, Sept 30 Argentina's leading Merval
stock index will grow to include 23 companies in the
fourth quarter of 2016, up from 15 currently, the stock exchange
Mercado de Valores de Buenos Aires said on Friday.
The index's composition is updated every three months based
on which companies were most liquid in the prior quarter. It
will be the first time since the fourth quarter of 2008 that the
index will have more than 20 companies, the exchange said.
The increase will come as welcome news to investors looking
for opportunities in Argentina after center-right President
Mauricio Macri was elected late last year. While they cheered
his market-friendly reforms, such as ending capital controls,
many were turned off by how few companies the Merval had listed.
They were also turned off by the index's heavy composition
of utilities, which are closely regulated, and banks, which are
struggling with rampant inflation seen as high as 40 percent in
Argentina this year. Oil companies like state-owned YPF SA
also have a strong influence the index.
Next quarter, companies from the telecommunications,
construction, paper and pulp, real estate and electricity
generation sectors will join the index.
The Merval has rallied 43 percent this year after a
36-percent gain last year, and set new record highs six times in
September, most recently on Thursday.
(Reporting by Jorge Otoala; Editing by Sandra Maler)