He month ended in negative territory for stocks and bonds, in a nerve-racking scenario for investors, following the rise in the price of the free dollar and, finally, the sanction of the Law Bases. Thus, various analysts consulted by iProfesional They recommend which alternatives you can invest in now in Julyin this a new economic direction that the Government can take.
To summarize how the market fared, the main index of Shares of leading companies, the Merval, closed June with a 2% dropwhich represents a negative 10% in dollars. Therefore, for the whole of 2024, it has now accumulated an increase of 73%, a level that practically matches the inflation that has been going on for the year.
The Biggest declines in leading stocks listed on the Buenos Aires Stock Exchange reached up to 15%hand in hand with Cablevision. Although The biggest drop was recorded in Argentine companies listed in dollars in New York, with the ADR format, because their prices fell by up to 22% throughout the month.as was the case of IRSAfollowed by BBVA (-18%), Cresud and Telecomin both cases with a monthly decline of 17% in US currency.
On the side of the fixed rentin June there was a increase of up to 8% in bonds nominated in dollars with national law, led by debt paper maturing at 2030 (AL30) and by the Global in the same year (GD30). On the other hand, there was a significant drop in hard dollar bonds, those with local legislation such as New York law, which fell up to 7% in the month.
“June was driven mainly by political and macroeconomic drivers. These included the vote on the Ley Bases and the fiscal package, a low liquidation of dollars from the agricultural sector, an increase in activity and imports, and an increase in the free exchange rate.summarizes iProfesional Rocco Abalsamo, PPi market analyst.
Refering to Bases Law and the fiscal packagethe different comings and goings in Congress generated uncertainty in the market, “stopping the possible rise that we estimated After its approval, specifically, the divergences that affected the mood of investors were the reduction of privatizations, and the non-inclusion of the sections that dealt with Personal Assets and the Income Tax. Something that was only reversed in deputies on June 27, this being positive for the debt in dollars,” completes Abalsamo.
At the same time, in June the Government announced Two encouraging news that meet the objectives of the economic program, and it has to do with the fact that in May both the fiscal surplus and the trade surplus were maintained.
“These achievements, together with a significant slowdown in inflation, strengthen credibility and confidence in the current administration. In addition, the weakness in sovereign bonds has caused the country risk to increase again.”considers Guido Nigrafinancial advisor at Balanz.
Argentine stocks listed in both Buenos Aires and New York fell by up to 22% in dollar terms in June.
To consider, according to Abalsamo, investors now Now they set their sights on the elimination of the exchange rate and the effective implementation of the Bases Law and the fiscal package.
What to invest in July: recommended bonds
With the scenario left by the busy June, savers They wonder what to invest in in July, where they prevail dollar bonds and energy stocks.
Especially on the bond side, Jose Banoeconomist and financial analyst, maintains that “I love the Global with maturity in 2035 (GD35) among the preferred dollar bonds.”
Abalsamo agrees with this, stating that “We also remain firm in our recommendation of GD35, where we estimate that the price could head towards US$70.4, an increase of 73% in 12 months, if the yield curve is compressed to that of comparable countries, meaning a reduction in country risk of approximately 680 basis points.”
It is important to note that when investing, It depends on the investment horizon and the level of risk to which you want to be exposed.
“For the most conservativesthe National Treasury bills capitalizable in pesos (Lecaps) are a good optionFor retail investors who are not familiar with these instruments, there are several issues and some do not have sufficient secondary market. Specifically, there are two alternatives to this: wait for a new tender, since there are recurring ones, or invest in a fixed income common investment fund (FCI)with rates of return close to 4% per month,” he told iProfesional Marcelo Bastantemarket analyst.
For investors with a longer horizon, he believes that sovereign bonds remain a good bet, especially the one issued in 2030 (AL30), where it was parked at levels close to US$55, although it reached a maximum of US$60 and “has room to rise.”
“It is clear that the bond is at attractive values and, in the long run, it will rise. What You never know when you’re going to make the jump, That is why it is not the most recommended for investors with a short-term horizon,” explains Bastante.
According to analysts consulted by iProfesional, investments in dollar bonds and energy stocks are recommended in July.
In this sense, Paola González, retail analyst at TSA Bursátil, maintains that, with the approval of the Bases Law in Deputies, “a political issue is unlocked that could generate a new boost for Argentine bonds. As a strategy, we suggest the combination of bonuses from short section of the curve like the AL30which begin to be amortized in the next payment, with medium-term bonds, such as the Global 2035 (GD35), which are more ‘defensive’ due to their lower parity, while retaining potential for increases in their price.”
And, for July, this expert maintains that she continues to recommend to CER bonds, such as T2X5 or T5X4for “the purposes of obtaining a rate in pesos in the face of inflation, which is not clear if it will continue with the path of strong deceleration demonstrated in recent months. At the same time, the linked dollar bonds to take a position regarding an eventual exchange rate unification”.
Stocks to invest in July
Also various actions, especially energy, are recommended by analysts consulted by iProfesional to invest in July.
“We stand firm in our energy recommendations, such as YPF and Vista Energy“We also highlight that the considerable drop in banking stocks throughout June could present a good entry point,” says Abalsamo.
For his part, Nigra comments that the The energy sector “seems attractive, especially the segment of the Basic Law intended for RIGI”where you can clearly see The companies Transportadora de Gas del Sur (TGS) and Pampa Energía were favored for the projects involved that support the planned development of the Rincón de Aranda shale area, and could even partially participate in some LNG project.”
Finally, Bastante agrees, and clarifies that for the riskiest investors and for an extended period, shares continue to have their appeal, after the correction they suffered in the last month and a half.
“Above all, the sectors linked to energy, due to the potential of the recently approved RIGI projects. In particular, I opt for Pampa Energía, Ternium, TGN and TGS”he concludes.-
