The market euphoria after the government’s latest offer of debt replacement was as powerful as it was volatile. Is it after the energetic increases recorded during the day yesterday, Investors returned to a more cautious attitude that left an expected slowdown in government bonds in dollars and most stock corrections of Argentine companies.
After a start on the wheel of small corrections, sovereign dollar bonds succeeded in reversing the trend and took land again, even though Finance Minister Martín Guzmán acknowledged that the differences still remain with the Blackrock Fund. Among the titles issued under foreign law, which rose to 5.7% yesterday, were observed improvements between 1
Yes, more significant improvements could be seen among foreign currency bonds operating under local law. There, the trend remained positive after the government on Sunday confirmed its intention to give the said titles equal treatment with regard to those issued under foreign law. he Discount, which led yesterday’s improvements with a staggering 11.7% increase, remained the best performing and grew 4.28%. They followed, among the best practitioners, Bonar 2037 and Bonar 2020, with respective increases of 2.22% and 2.18%.
This new improvement in dollar bonds caused a further reduction in country risk. The index that JP Morgan measures consolidates below 2400 points by providing 67 units up to 2332 basis points.
However, the scenario was different too local capital. After fired yesterday, local ads decreased on average by 4%. In line with the fall in the leading Wall Street indices, which fell between 0.8% and 1.5%, shares in Argentine companies fell up to 10.8% under the leadership of Cresud, which had led to progress on Monday. The roles of Transportadora de Gas del Sur and Corporación America followed, with a fall of 7% each.
The trend was also replicated in the local stock market. The Buenos Aires Stock Exchange fell this Tuesday due to profit taking and in line with external markets. S&P Merval Index fell 1.94% to 42,497 units, after climbing 9% on Monday. Write-downs reached up to 5.57% in the local stock market and were also led by Cresud’s paper.
“The government’s offer surprised the market positively and the difference with the claims from the major lender groups is significantly reduced in this case. Having said that, the process is not closed and the market is still waiting as far as the major creditors’ committees can manifest, “he summed up Santiago Abdala, Head of Personal Investment Portfolio (PPI).
Regarding the behavior of dollar bonds, Abdala indicated that “the renewed interest in government bonds that closed the company“When he mentioned the fall in the shares, he considered:”Volatility, after a day of rising 22%, seems somewhat expected“.
AND Looking forward, head of PPI suggestions: “Some form of statement from the toughest creditor committees would act as a catalyst in prices. If the market places high odds on a fragile business, prices should be significantly lower. Still, everything remains to be seen“.