The sovereign titles denominated in dollars scored firm improvements of up to 3.9%, thanks to Bonar 2038, followed by Bonars 2029 and 2035 (+3.6%); and by Global 2035 (+3.3%). The titles are +10.6% above the post-restructuring lows registered on March 8 last.
Consequently, the weighted average price jumped above $33 for the first time since last February 24, PPI reported. The indicator rose +2.8% to US$33.01 and moved away from recent lows.
With everything, Argentina’s country risk fell 34 units to 1,751 units, its lowest value since last February 23compared to the 1,083 points registered in 2020 after a million-dollar restructuring of private debt and a historical maximum of 1,991 units noted at the beginning of this March.
“We believe that the agreement with the IMF was already practically priced in. Meanwhile, The better climate for the entire universe of emerging debt helped. The pause in the rally of long rates abroad and the expectation of the negotiations between Russia and Ukraine favored a better performance within emerging credits,” PPI analysts commented.
For example, Ukraine’s 10-year bonds recovered ground and Turkey cut its yields by 6 basis points. Within the region, LATAM bonds lowered their yields between 1 and 5 points.
The IMF directory finally endorsed on Friday a new debt program with the South American country, although he acknowledged that it carries “exceptionally high” risks and advanced the first review of the macroeconomic numbers to mid-May.
“The agreement with the Fund comes to worsen the financial variables, I am not going to say improve because it is too big, that the gap decreases a little, that the exchange rate stops falling behind, that the reserves rise a little, that the country risk lower a little, but at the cost of worsening the real variables”said economist Rodolfo Santángelo of Macroview.
The Minister of Economy, Martín Guzmán, recognized that the deal may require adapting economic policies. He argued that the Russian invasion of Ukraine changed the expectations of the global economy in the face of strong increases in raw materials.
With the agreement of the IMF, “the immediate cessation of payments was avoided, but the balance of public finances would require a reduction in expenditures that would be difficult to implement politically,” estimated the consulting firm VatNet Research.
On the other hand, dollar-linked sovereign bonds in pesos fell in the short section, with TV22 losing 0.2% (it had good business volume).
Finally, the CER debt was highly offered prior to the Treasury tender, yielding an average 0.5% along the curve, with special punishment in TX23 (-1%).
In the external context, on the other hand, Oil prices plunged 7% amid fears of weaker demand from China. after the financial center of Shanghai was closed to curb a rise in Covid-19 infections, at a time when world attention was also focused on the resumption of peace talks between Ukraine and Russia.
In the midst of the uncertainty generated by the Argentine situation, with fights in the government coalition, the S&P Merval index of the Buenos Aires stock market lost 1.4%, to 91,662.96 points.
The negative performance of Grupo Financiero Galicia stood out (-2.7%), which traded 28% of all local shares. $3,845 million in equities were traded, of which 75% was taken by the Cedears.
For its part, on Wall Street, the shares of Argentine companies closed without a uniform trend, with rises led by Free Market (+5%); and Edenor (+1.8%); and decreases led by IRSA Commercial Properties (-5.4%); and Bioceres (-3.5%).
Meanwhile, the New York Stock Exchange began the week with the S&P500 reversing the intraday drop to end with a rise of 0.7%. The 10-year US Treasury bond rate fell two basis points to 2.45%, with the striking fact that the 5-year and 30-year curve was inverted for the first time since 2006.
At the local level, senators from the FdT presented a project to to set up a “fund to cancel the debt with the IMF” that consists of a “special emergency contribution” for those who have undeclared assets abroad.
Source: Ambito
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