Argentine bonds rise and country risk falls after US support for negotiations with IMF

Argentine bonds rise and country risk falls after US support for negotiations with IMF

Bolsas y Mercados de Argentina (BYMA) operates at rise this Thursday and thus maintains the trend of the three previous days, driven today by the positive result of the meeting between President Alberto Fernández and his counterpart from the United States, Jo Biden, in which they negotiated support of that country before the International Monetary Fund (IMF). In addition, this increase occurs in a day in which the international markets also show a positive dynamic thanks to an increasingly marked stabilization of the banking sector in the United States, after the financial crisis that was unleashed by the fall of the Silicon Valley Bank.

Consequently, at the local level, the good news this Thursday is the progress of government negotiations with the International Monetary Fund (IMF) for a new disbursement by the agency to be made. This generates expectation in the City because the market expects that this Friday the Fund will endorse the goals achieved by the Argentine Government in the fourth quarter of 2022 and generate concrete indications of a more flexible number of central bank reserves (BCRA) for this year as a result of the historical drought that affects the agro-export sector. If the IMF confirms the fulfillment of Argentine goals by the end of 2022, the IMF must disburse 5,300 million dollars and the Fernández government must comply with an outstanding debt of about 2,700 million dollars.

While, on the other hand, Moody’s Investors Service lowered the outlook for the banking system from Argentina to ‘negative’, from ‘stable’, due to the “deterioration of operating conditions, amid a significant reduction in expected economic growth, with a probable contraction of GDP of 0.5% in 2023 and persistently high inflation , which already exceeds 100% per year”.

The Ministry of Economy awarded titles for a cash value of $294,502 million on Wednesday (about US$1,413 million) through a basket tender with seven instruments. 41% was made up of instruments adjusted to the official exchange rate, 31% at a fixed rate, and 28% by instruments tied to inflation (CER).

Find out more – I followed the price of the blue dollar, official, CCL and MEP in Argentina

However, the main index, the S&P Merval rises 0.46% to 250,273.75 points and the actions of the leading panel of the local stock market show a bullish majority as well. They rose to 2.65%, led by Aluar (ALUA) and Black Hill (HILL) secondly, that it scales 2.39%. Meanwhile, the decreases that are observed are smaller, between 1.12% and 0.6%, mainly in some papers of local banks (Macro Bank, Grupo Galicia and BBVA).

Falls and rises in ADRs on Wall Street

On the other hand, the ADRs of Argentine companies listed on Wall Streett are listed with a majority downward. Such is the case of Pampa Energía, which is the one that falls the most (-1.71%), Grupo Financiero Galicia (-1.55%), Grupo Supervielle (-1.26%) and Despegar (-1.16% ). BBVA also fell 0.96%, Central Puerto lost 0.80% and IRSA fell 0.57%.

Those that rise are the ADRs of Edenor (4.38%), Telecom Argentina (+3.28%), Loma Negra (+1.81%), Transportadora Gas del Sur (1.16%), YPF (+0 .91%) and Cresud (+0.09%).

Bonds rise and country risk falls

Meanwhile, the Argentine dollar bonds they all have an upward trend, except for the GD45 (-0.4%). The one that rises the most is the AL 35, which rises 2.9%, followed by the GD29, which climbs to 2.5%, and the ones that recover the least ground are the CO26 (+0.2%) and the GD30 ( +0.4%). Thus, the recovery that they have been having since the beginning of the week is confirmed.

In this context, the risk country it falls 23 units (0.98%) to 2,334 points. It is the fourth consecutive day that shows this trend against a level above 2,500 units last Friday.

Source: Ambito

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