JP Morgan and Morgan Stanley analysts highlight that, despite political uncertainty and the risk premium incorporated by the market, there are attractive options. What modifications foresee after the elections.
The closeness of the legislative elections in the province of Buenos Aires generated a high market volatility. The measures implemented to contain the dollar They took investors to incorporate A risk premium in assetswhile rumors of corruption around figures close to Javier Milei increased attention to the electoral results of next Sunday. Despite this complex scenario in the short term, analysts of JP Morgan and Morgan Stanley They emphasize that they exist attractive investment opportunities in local assets, both in dollars and pesos already thinking about a medium and long term.
“As the elections are approaching, the markets incorporate into prices a growing political risk premium. In just over a week, the Differential EMBI (country risk) were extended about 140 basic points, the weight experienced a maximum drop of 5% before recovering, and the returns of the LECAP after the elections, dated September 12 and October 31, 2025, increased from 49% to more than 60% in terms, before 60% to stabilize around 50%, “JP Morgan contextualized.
Bonds in pesos: why the flotation band works coverage
According to JP Morgan, investors can find opportunities in Bontam bondsthat combine a fixed rate and a variable rate tied to tamar. Given the current level of rates, it is likely that variable part determines the final paymentwhich makes the bonds of March and December attractive. The entity also highlights two other strategies:
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LECAPS/BANCAPPS: The returns covered in FX are attractive, allowing to capture Spreads without assuming exchange risk. The dollar flotation band acts as a exchange risk coverage in these instruments.
JP Morgan emphasizes that volatility is probably maintained to elections and that investors must be attentive to the peso market.
Morgan Stanley: Look towards the bonds in dollars
For its part, Morgan Stanley emphasizes that Argentine assets were lagging in 2025, which suggests that the impulse of reforms is not yet reflected in prices. The firm recommends position yourself slightly long before the elections of the province of Buenos Aires (September 7) and points out that a good result could support policy continuity and strengthen the administration reform agenda.
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In sovereign bondsMorgan Stanley estimates that these titles could close the year with yields below 10%with a bullish potential of 11 points.
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In Actionswhich quote a 7.9X P/E Forward, the bullish potential is also attractive, and recommend maintaining positions in Vista, Banco Galicia and Loma Negra.
LIVING FINANCE MARKETS ACTIONS INVERSIONES INVERSIONS DOLAR BONDS
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Political Risk and Politics Post Elections
JP Morgan emphasizes that “the historical importance of the elections, in a context of lower liquidity, will probably maintain high volatility in the coming days. With 40% of the population of the country, voting provincial legislators, the markets will be attentive to the results to project possible implications in the national elections of October 26. Buenos Aires has historically been a bastion of peronism and there is no direct and automatic relationship between both elections ”.
In line with market rumors, Morgan Stanley states that There could be adjustments in the post elections economic policyin tune with the official vision of the government. According to the Minister of Economy, Luis Caputo, the volatility of fees is “transient.” Among the most commented alternatives is the End of the exchange flotation bandkeeping a base dollar around $ 1,300which would improve competitiveness and at the same time as the BCRA accumulate reservations.
Source: Ambito
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