“Argentine assets were being strongly dragged by a negative external context, where the ‘risk-off’ climate deepened due to the dynamics of the US Treasury rates and their implications for the economy, given a growing risk of recession”, the economist Gustavo Ber commented to scope.
Also, At the local level, the recent measure on the “soybean dollar”, together with the challenge of monetary sterilization that will be associated with this strategy, also played against it, although in a secondary way, analysts agreed.
In that framework, the S&P Merval index lost an unusual 4.4%, to 142,931.74 points, to fall back to the minimum zone in just over two weeks.
Among the losses, YPF shares stood out with -10.3%, at 1,956 pesos at times when the price of oil fell about 6%, to an eight-month low, as the dollar rose to a two-decade high on recession fears.
For its part, Wall Street closed with sharp falls, another dark week and very close to its lowest levels of the year, dragged down by fears of a recession caused.
The Dow Jones established a new low for the year and rebounded slightly to close with a loss of 1.6%. The tech-heavy Nasdaq lost 1.8%, while the broader S&P 500 fell 1.7%.
“What you see in today’s market, as the saying goes, like a ‘sell now and ask later’ trend, is just that: increasing cash in the face of rising uncertainty and volatility,” says Quincy Krosby of LPL Financial.
The drop comes after the Fed raised interest rates by 0.75 percentage points on Wednesday, the third consecutive hike of this magnitude, and Fed Chairman Jerome Powell said he was determined to continue monetary tightening to counter inflation.
The decision led to rate hikes from the Bank of England, among other central banks, on Thursday, boosting the chances of a global recession.
Black Friday led by the collapse in commodity prices dragged down Wall Street and the European stock markets, in tune with the depreciation of the euro and the pound to record lows against the dollar.
“We have lived a hard day, prices sank in a general way. The international reality is similar to the 2008 crisis (with mortgages in the United States), plus the aggravating factor of inflation (…), with its own uncertainty (Argentina) given by shocks difficult to digest”, an Asian private banking analyst said.
Bonds and country risk
In the fixed income segment, and like Argentine stocks in New York, sovereign bonds in dollars closed sharply lower, affected by profit-taking in the face of renewed risk aversion. The biggest setbacks were led by Global 2035 (-3.9%), Bonar 2029 (-3.8%), and Global 2041 (-3.7%).
Thus, the country risk measured by the JP Morgan bank rose 3.9% to 2,538 basis points, highest since late July.
Source: Ambito
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