On a key day for the government of the libertarian president Javier Mileifor the treatment in the Senate of the “Bases Law” and the tax package, the stock market operates with selective improvements in a cautious operating context.
The leading index S&P Merval of the Buenos Aires Stock Exchange rises 2%, to 1,570,000 units at 12:30 p.m., in a trend led by the improvement in financial and energy stocks, after falling 2% the day before and skyrocketing 3.8 on Monday.
Among the ADRs and shares of Argentine companies that are traded in dollars on Wall Street, the slight increases led by Grupo Financiero Galicia (+3.8%), Banco Supervielle (+3.6%) and YPF (+3.3%).
We have to “look beyond the Bases law, which will surely come out, but it is a short-term driver,” he commented. Cristian Lopez, analyst at Portfolio Personal Inversiones. “You have to follow the fundamentals that can tell us that everything can really change in the long term, after so many years of decline,” he stated.
In the midst of thousands of demonstrators protesting against the bill, the debate in the Senate promises a very even vote, since the ruling party has few legislators in the Upper House and has not managed to convince the majority about the benefits of the reforms.
There is a primary role for three senators who had not confirmed their willingness to vote for the Government to be successful in Congress. At night, Santa Cruz senators Carambia and Gadano called not to give a quorum if the tax and pension reform, promoted by Deputies, is not discussed before the Base Law.
In turn, the radical Martín Lousteau had mentioned on social networks that he would provide a quorum. Beyond the fact that the quorum was finally a fact, the ruling party is in a situation of very tight numbers to approve both initiatives, since at the moment it is speculated that there would only be 36 votes in favor.
“Definitely, There is nothing left but to wait for the evolution of the day to contemplate the result of this plot. Today the main drivers of Argentine assets is the package of measures promoted by the current administration. A setback in the Senate would generate an even more significant challenge with political, economic and social consequences that are difficult to foresee,” they assessed from Portfolio Personal. “In this context, contrary to emerging markets, sovereign debt hard dollar could not sustain the favorable tone,” they added.
In that sense, Argentine dollar bonds rise close to 1% on Wall Street, with a risk country of JP Morgan that cuts 27 units for Argentina, in the 1,498 points basics.
On the other hand, let us remember that this Wednesday The Treasury seeks to renew maturities for $5.18 billion with a menu composed of three Lecap, with a joint limit of $5.4 billion. The menu includes the reopening of letters on July 12 (S12L4) and August 16 (S16G4). Likewise, it will issue a new instrument on September 13 (S13S4) taking into account a minimum monthly effective rate (TEM) of 4.25 percent.
Another positive fact that could encourage the rise of domestic stock market assets is the rise experienced by the main Wall Street indicators after the announcement of the North American inflation data, after the acceleration registered in the first quarter.
Headline inflation in the US was 0% monthly in May, slowing from 0.3% in April and positively surprising analysts who were stuck at 0.1%. The cut in energy prices (-0.14% monthly) was a key factor in consolidating the downward trend. In particular, fuels fell 3.5 percent.
