UPDATE 9-Argentina's powerful ex-president Kirchner dies

* Kirchner was contender for 2011 presidential race

* He oversaw Argentina's recovery from economic crash

* Critics saw him as divisive, authoritarian figure

* Argentina asset prices rally following news (Adds fresh quotes, color on supporters)

By Helen Popper and Nicolas Misculin

BUENOS AIRES, Oct 27 (Reuters) - Argentina's Nestor Kirchner, the president's powerful husband and a top contender to succeed her next year, died on Wednesday, lifting stock and bond prices but heightening uncertainty ahead of the election.

Kirchner, 60, was president between 2003 and 2007 and is credited by many with putting South America's No. 2 economy back on its feet after a devastating 2001/02 crisis, but critics reviled his combative style and interventionist economic policies. He died of a heart attack.

Argentine bond and stock prices rose on news of the death of the center-leftist, who kept a firm hold on the reins of power even after his wife Cristina Fernandez was elected to succeed him in 2007.

Kirchner's death raises questions about the government's strategy for the presidential election next October, and may encourage Fernandez to run for a second term and adopt a less confrontational stance in a bid to garner broader backing.

"History will rightly remember him as one of the best presidents of the last 50 years," said Ricardo Garcia, 52, a lawyer who joined tens of thousands of supporters in front of the famous pink presidential palace.

"The country is no longer on its knees like it was in the 1990s," he added, referring to an era of free-market economic policies that Kirchner frequently blamed for causing the 2001/02 meltdown.

Supporters tied bunches of roses and condolence messages to the railings of the palace, some reading "Thank you Nestor" and "Stay strong Cristina." The blue-and-white national flag flew at half staff during the day, a public holiday.

Kirchner, who died in the southern city of El Calafate, was still popular when he left the presidency. But his approval ratings have since fallen -- especially among middle class Argentines, dented by messy disputes with farmers and leading media conglomerate Grupo Clarin. (CLA.BA)