Argentine stocks and bonds rise on Wall Street as country risk falls

After the President’s speech Javier Miley at the opening of legislative sessions, American depositary receipts (ADR) Argentine companies listed on the New York Stock Exchange ended the day with growth, although far from euphoria. At 17:00, when the Argentine stock market closed, YPF profit from 4.9%This is followed by Loma Negra (+3.8%) and Banco Francés (+2.9%).

At the same time, the index S&P Merval Buenos Aires Stock Exchange In pesos it lost 0.7% to 1,047,614 points but gained 1.6% in dollars.due to the new fall in cash-to-settle parity implied in the evolution of ADRs.

Sovereign bonds. The exchange’s dollar-denominated government securities rose an average of 2% after an initial rise of 3.5% both locally and overseas. The shortest-dated global bonds, GD29 and GD30, were trading at US$49 on Wall Street, close to the high of US$51.50 reached in September 2020 when they began trading on the secondary market following a restructuring.

In the same sense, country at risk JP Morgan, which measures the difference in US Treasury yields with emerging market peers, cut 35 units this Monday for Argentina. 1582 points fundamentals at 5:15 p.m., after touching 1,534 units in the morning, the low since Sept. 17, 2021.

The bullish rally comes after Miley called on governors to join “May Pact” after weeks of conflict with leaders.

It is worth recalling that on Friday, ahead of the head of state’s speech and given the uncertainty of possible economic measures, more than 683,000 dollar futures contracts were trading with strong gains as a result of hedging, which “likely caused concern among other speculators and hedgers.” “And they decided to run the show with speculative positions or offset the sold positions of the official exchange rate, and there was a rush of buying,” they said from Blowout.

The market reacted positively to the initiative of the executive branch to meet on May 25 in Cordoba to sign an agreement and create 10 government policies, whose guidelines will be subject to the prior approval of the presented “Law on the foundations and starting points of the freedom of Argentines” and the new financial pact. Points:

1. Inviolability of private property.

2. Non-current budget balance.

3. Reduce government spending to historic levels, about 25% of gross domestic product.

4. Tax reform, which reduces tax pressure, makes life easier for Argentines and promotes trade.

5. Renegotiate federal tax distribution to put a permanent end to the current predatory model.

6. Obligation of provinces to promote the exploitation of the country’s natural resources.

7. Modern labor reform promoting formal employment.

8. Pension reform that ensures the sustainability of the system, respects those who have contributed, and allows those who choose to subscribe to a private pension system.

9. Structural political reform, which changes the existing system and realigns the interests of representatives and those represented.

10. Opening up international trade so that Argentina can once again become a major player in the world market.

The announcement was well received by business chambers, who quickly expressed their support.

Among the first Argentine Chamber of Commerce (CAC) as well as an organization that unites grain exporters, CIARA-CEC.

“The diagnosis and course of action proposed by President Miley are moving in the right direction. From our background, we strongly support the deregulation process being undertaken by the national government, as well as strict financial and monetary regulation, austerity in the management of public funds and the fight against entrenched corruption in various fields,” he said. Natalio Mario Greenman,

President of the CAC.

Representatives of CIARA-CEC confirmed that “the speech of the President of the Nation, Javier Milea, at the opening of the regular sessions was convincing, clear and precise regarding the path that must be taken to overcome this deep economic and social crisis. We call on governors to join May’s Pact to lay the foundation for the sustainable development our country needs and the value-added foreign trade that is key to economic growth.”

He Argentine Agricultural Council (CAA)for his part, said: “We call on political forces, provincial governments, legislators, as well as businesses and workers’ unions to work to ensure that Mayo Cordobes becomes the starting point of a new Argentina that attracts investment, creates quality employment and can go further.” . go out into the world with value-added products.”