The S&P Merval suffered its fifth consecutive weekly decline, hit by the global banking crisis

Yes ok on Thursday the markets had closed with some better outlook as a reflection of the fact that a group of large US banks that will deposit US$30,000 million to save the First Republic Bank, this Friday, nervousness renewed of investors for the instability in the banking system.

Added to the external context are doubts about the future of the Argentine economy, in the midst of a growing inflation, economic slowdown, lower agricultural exports due to a severe drought, and scarce reserves of the Central Bank (BCRA).

In that framework, the shares of Argentine companies sank to a maximum of 8%as it happened with Take off. The top five of the biggest falls of the day were completed by Grupo Supervielle (-7.1%); BBVA Bank (-5.8%); Banco Macro (-5.4%); and YPF (-4.9%).

During the week, Grupo Supervielle fell 16%; YPF, 14.9% (in line with oil baka); and Banco BBVA, 14.6%.

“Argentina is isolated from the rest of the world and in that sense, there is no contagion, but if the crisis deepens, Argentina has to negotiate with the IMF, and people will have less ear to listen to us when there is a global crisis,” said Javier Timerman, a partner at Adcap Grupo Financiero. “Locally, I think the impact may be that less attention will be paid to peripheral issues“, he estimated.

In the porteña bag, for its part, BYMA’s leading S&P Merval stock index fell 0.7% to 221,740.26 units, affected by falls in Argentine ADRs in New York. The week ended with a negative drag of 6.2%. It was the fifth weekly loss in a row. In addition, in the month, it fell almost 19% in dollars (CCL), and 10.4% in pesos.

The main casualties of the day were led by Supervielle Group (-5.8%); BBVA Bank (-4.5%); and YPF (-4.9%). On the contrary, the increases of 10.2% of Transportadora de Gas del Norte, 7.4% of Aluar, and 4% of Ternium stood out.

The leading panel shot up 6.5% the day before, accumulating an improvement of 9.7% in pesos so far this year (and a 6.4% drop in CCL dollars)., compared to inflation estimated by analysts at around 15% in the same period. The S&P Merval is prone to rapid unwindings by offering greater liquidity for portfolio rebalancing.

Market expectations by the Fed

Now, eyes are on the next monetary policy meeting of the United States Federal Reserve (FED) and in the decision you will make about the rate.

And it is that a large part of the current crisis is explained by the agency’s decision to raise it to combat inflation, which generated a mismatch in some banking entities that had part of their funds invested in long bonds, very susceptible to political dynamics. monetary.

Bonds and country risk

In the fixed income segment, the sovereign bonds in dollars fell to 2.4% (Bonar 2035), hit by the external context adverse to risky investments. It only closed up Overall 2041 (+0.3%). In the week, they recorded drops of up to 4.7%.

“Argentine bonds locate their parity even at levels lower than those at the beginning of January, erasing all the return they have earned since that date”said Portfolio Personal Investments (PPI)

All in all, the country risk measured by the JP Morgan bank it shot up 2.8% to 2,388 basis points.

On the other hand, the monetary entity increased its referential interest rate to 78% annual nominal (TNA), from a previous one of 75%, to accompany the inflationary pressure and offer investors positive financial returns. Thus, the BCRA reference interest rate will be equivalent to a TEM of 6.4% and a TEA of 113.3%. “It generates a negative return in real terms -below the February inflation rate of 6.6% m/m and 115.3% annualized-“maintained from Cohen Aliados Financieros.

“In this way, the decision of the BCRA fell short to align with one of the requirements of the IMF to tend to positive real rates. Specifically, its objective is that placements in pesos do not lose ground compared to dollarization alternatives, facing the year electoral, and put pressure on the gap,” added.