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Buenos Aires stock market operates almost stable in a market conditioned by high inflation

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Prices increased 3.8% in the last month and climbed 50.9% in the previous year, the National Institute of Statistics and Censuses (INDEC) reported on Thursday., despite government controls and the strict exchange trap that complicates the financial sector.

Meanwhile, talks between the Government and the IMF are dilated to try to resolve a complex debt of some 45,000 million dollars, of which some 4,000 million must be repaid in March and the central bank (BCRA) has practically no reserves for face it.

After learning that monthly inflation for December rose to 3.8%, which implied a year-on-year CPI of 50.9%, the profits of companies listed on the local market were cut. In turn, the bonds listed in dollars fell up to 3.3% in the midst of the uncertain scenario of the national government in the face of the agreement with the IMF for the debt of US$45,000 million.

The S&P Merval index of Argentine Stock Exchanges and Markets (BYMA), therefore, recorded its third consecutive improvement by rising 0.3% and be located at 85,370.86 units.

The leading panel’s biggest raises were YPF (+3.1%), Aluar (+2.1%), and Banco BBVA (+2.1%). While the main casualties were Transportadora de Gas del Sur (-2.6%), Telecom (-1.5), and Ternium (-1%).

“The scenario is complex, because The Government wants to agree to avoid default, but from the Fund there are demands that politically here (in Argentina) they do not even want to listen to because the word ‘adjustment’ could muddy the presidential race for next year’s elections,” said a foreign banking analyst.

To the macroeconomic panorama of doubts due to the agreement with the IMF, it was added that this day the Indec revealed that inflation accelerated in December to 3.8%. In this way, in the accumulated of 2021, prices increased 50.9%, the second highest mark in 30 years, behind that of 2019.


For their part, Argentine companies listed on the foreign market closed mixed. The ones that increased the most were Banco Macro (+1.8%), Banco Supervielle (+1.6%), and IRSA (-1.3%) and the biggest losses were recorded by Globant (-7.1%), Mercado Libre (-6.1%), Ternium (-2.6%).

“Wall Street resumes calm after the best tone of the last wheels, with a new reading of high inflation already discounted, before which local assets accompany the external climate while operators remain attentive to the signals on the political strategy against the IMF Gustavo Ber said.

And expanded: “The main ADRs are still looking to recover ground from punished valuations based on tactical bets by operators who seek to take advantage of the external momentum while waiting for news about the IMF.”

Argentina’s sovereign debt deepened its losses on Thursday due to the distrust of investors to delay an agreement between the Government and the IMF to renegotiate maturities for some US$45,000 million.

Titles in dollars fell to 3.3%, for which Country Risk advanced 0.6% to 1,863 units, the highest figure since November 30 of last year.

In search of support from the Joe Biden government, Foreign Minister Santiago Cafiero will travel to Washington. “The agreement with the Monetary Fund is not only an economic issue and Foreign Minister Cafiero is now traveling to the United States to carry out other types of meetings that have to do with the geopolitical discussion and between States about the next agreement,” he said at a conference. press release by presidential spokeswoman Gabriela Cerruti.

“Argentina has already presented its proposal and is waiting. It is now in the hands of the organization to try to give the answer as quickly as possible”, he emphasized.

The biggest difference between Argentina and the IMF is in how to reduce the fiscal deficit, since the institution led by Kristalina Georgieva intends it to be through a spending adjustment, while the Government seeks a more gradual reduction, supported by the higher collection.

Source From: Ambito


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