The Argentine stocks that operate on Wall Street they extend sharp falls of up to 7% this Tuesday, June 7, while the dollar bonds they collapse up to 4%. Meanwhile, the Buenos Aires stock market registered a sharp fall profit taking after the bullish rally that marked in May and at a time when external markets are trading lower due to doubts about the US economy, the elections in India and the electoral result in Mexico.
At the local level, the treatment of the Bases law in the Senate and the expiration of the currency “swap” with China put a blanket of caution among investors. The investment advisor, Gaston Lentinihe assured Ambit that, “all the markets in the world started red”.
“The victory of the leftist candidate in Mexico and the electoral results in India are the context,” says Lentini. Likewise, the strategist points out that we must remember that the Buenos Aires stock market rose the most in the world for two years in a row, “so this decline is a healthy part of the market and for many it is what they were waiting for to be able to take new positions.
The elements that generate market noise
Another market source agreed with lentini and slipped that this fall in national assets “It comes from the rumors of the non-renewal of the swap with China. In addition, the votes for the Base Law are counted by hand, so any false step could cause it to not be approved.“.
In that sense, Argentina would have to put something like US$5,000 million to pay off the debt with Beijing. “What could save us is to renew the swap or that he International Monetary Fund (IMF) lend us those US$15 billion that are being talked about,” the source added.
“And the news that the basic law would not come out until July and that we have to pay the Chinese US$5 billion (of the little we have) delaying any desire to get out of the trap soonseem to set the mood of the day in the country“said the source.
Argentine assets in decline
The index S&P Merval give up a 3.3% to 1,659,247.61 units, after gaining 0.5% the day before and accumulating a strong improvement in 24.8% during May.
“There is no doubt that the main driver is the future of the Bases law and the fiscal package. Although their approval is expected next week in the Senate and their ratification by Deputies in July, The comments made by the protagonists will have an impact on the mood of investors“, they point out from Portfolio Personal Investments (PPI).
Foreign markets were trading in the red amid evidence that the “exceptionalism” of the US economy could be beginning to fade as manufacturing activity weakens.
The leading panel stocks that top the red list are: YPF (-5.4%); Supervielle Bank (-5.4%); Northern Gas Carrier (-5%) and BBVA (-4.7%).
ADRs
Meanwhile, Argentine stocks listed on Wall Street also sink to 8.2% and leads them BBVA; Galicia Financial Group (-7.8%); Supervielle (-7.8%) YPF (-7%) and Macro Bank (-6.8%).
Dollar bonds
Bonds nominated in hard currency follow the trend of equity assets. In this context, they fell to -3.6% after moderating the fall that in the first operations reached more than -6%.
The casualties are led by AL35D with -3.8%; he is followed by AE38D with -3.6% and by GD35D which cuts -2.6%. In that sense, the country risk skyrockets to 1,464 pointswhich jumps 50 units or 3.5%.
