In a report on the situation of Argentine fixed income, the financial giant commented on which bond is its favorite and why.
The financial giant Morgan Stanley ratified its optimistic stance on Argentina’s sovereign bonds, despite considering the elimination of the fiscal package of the omnibus law; a move for which in the first trading sessions of the week, the market gave him a thumbs down. To begin with, Morgan Stanley defines that its favorite security in the argy market is Global 2046 (GD46).
“While the elimination of the fiscal package is a short-term setbackdoes not change our optimistic outlook on bonds. As long as there is still a path to the primary budget surplus of 0.8% of the Gross Domestic Product (PBI)”, states the document from the financial multinational.
And he adds, “along with the accumulation of reserves in foreign currency, we believe the market will increase the probability that Argentina will make foreign currency bond payments of $5.6 billion in 2025 (even with the help of the BCRA).”
Morgan Stanley adds that the two short-term bonds (GD29 and GD30) are likely to remain the highest beta bonds, “but we see room for GD46 to recover, becoming our favorite bonus“.
The financial firm assures that it continues to observe a “firm commitment to fiscal consolidation” by the Government, although analysts expect more details on compensatory measures to adjust their fiscal projections.
It should be noted that unless otherwise specified, the time frame for recommendations included in Morgan Stanley’s fixed income research reports is 1 to 3 months, and the price of financial instruments mentioned in the recommendation is at date, the document highlights.
Source: Ambito
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