Argentina is a member of both J.P. Morgan's NEXGEM frontier market index and the broader EMBI Global Diversified emerging market benchmark, though to qualify for the former a country must have a weight of less than 2 percent in the latter. <11EML>

Argentina's weighting was above the threshold for the past 12 months, standing at 12.64 percent on January 22, J.P Morgan said in a research note, adding the country will be removed from NEXGEM index on Jan. 29.

The main beneficiaries in the frontier markets index will be Sri Lanka, Dominican Republic and Costa Rica, which will see their weighting increase by between 0.98-1.37 percent.

J.P. Morgan also said it will reassess Argentina's weighting in its emerging market benchmark if the country would issue fresh hard-currency debt.

"Argentina’s weight is estimated to increase by +0.5 percent if an additional $10 billion in market value is added to the country's exposure in the benchmark," the note said.

Argentina has been embroiled in a more than decade-long battle over unpaid debts which prevents it from tapping global credit markets.

On Friday, Argentine President Mauricio Macri said that talks with U.S. creditors in the long-running legal dispute had not made much progress, although he hoped to reach a settlement early this year.

(Reporting by Karin Strohecker Editing by Jeremy Gaunt)