Economy The markets celebrate the continuity of the fiscal surplus and bonds touch $60 for the first time - Infobae

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The markets celebrate the continuity of the fiscal surplus and bonds touch $60 for the first time - Infobae​

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Los mercados festejan la continuidad del superávit fiscal y los bonos tocan por primera vez los 60 dólares

Se consolida la baja del riesgo país, que ya está más cerca de perforar los 1.000 puntos. La posibilidad de volver a los mercados financieros también luce más cercana. Los números favorables de las cuentas públicas y la mejora del nivel de reservas entusiasman a los inversores

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Apil 23, 2024

The decline in country risk is consolidated, which is now closer to breaking 1,000 points. The possibility of returning to the financial markets also seems closer. The favorable numbers of the public accounts and the improvement in the level of reserves excite investors

By Pablo Wende



Traders work on the floor of the Buenos Aires Stock Exchange, in Buenos Aires, Argentina February 26, 2020. REUTERS/Agustin Marcarian
The week started euphorically for Argentine assets, in what was the run-up to the President's national network. Investors celebrated in advance the fiscal surplus for the first quarter, which Javier Milei himself had already announced during the business forum organized in Bariloche last week.


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The increases were very marked and became more pronounced after midday. In the case of Argentine ADRs listed on Wall Street there were improvements that in some cases reached almost 13%, as happened with Banco Supervielle, but other entities were not far behind: Grupo Financiero Galicia climbed 9% and Macro closed 7% above.


Energy companies also operated very firmly. Pampa Energía rose 7.3%, while YPF climbed 7.5%, rounding off a great day for Argentine stocks.


Argentine bonds also shone and the country risk fell more than 5.7% to 1,148 basis points. This is a level that had not even been seen when Martín Guzmán managed to restructure the debt in 2020.

There were very strong increases in stocks and bonds at the start of the week. Javier Milei's message scheduled for the last minute excited investors, who are optimistic about the fiscal progress made by the Government as well as the improvement in the level of international reserves. In addition, a better climate on Wall Street helped

Possibly the most eloquent data has been the new rise of the AL30 in dollars. This title, which is the most sought after by investors, rose 4.5% and closed close to USD 60 for the first time since its appearance.


This is a true milestone that did not go unnoticed in the market, which sees Argentine debt rebound with a speed that few would have suspected just a few months ago. Longer bonds also had a favorable day, with gains close to 2%.

The improved fiscal situation impacts more directly on shorter bonds. This is explained because the AL30 is the first to be amortized and in July its first capital amortization falls, in addition to the interest payment.

To the extent that this consolidation of public accounts continues, the Government's repayment capacity improves. Therefore, the possibility of continuing to pay interest and principal on maturing bonds also increases, which makes shorter-term securities, especially, more attractive.

As country risk continues to fall, the chances of a return to the financial markets also increase, although there is still a long way to go to achieve this. However, to the extent that 1,000 points are drilled, something that does not seem impossible at all, that possibility grows strongly.


The IMF also contributed to the continuity of the good financial climate. The organization indicated last week that it estimates a drop in inflation to 150% this year, below market expectations, while the economy could rebound above 5% in 2025. Likewise, the recovery of reserves net profits, which would have already left negative territory, also plays in favor of the bond price.

Obviously the improvement in the international climate also played its part. Wall Street had a very favorable day, with rises in all indices and in particular in technology companies, which are the ones that most quickly reflect changes in the market's mood. Last week, for example, the Nasdaq index had fallen more than 5% due to rumors related to the geopolitical situation in the Middle East and overheated inflation in the United States, which reduces the chances of a quick rate cut by the Reserve. Federal. For now, the North American bond rate remained unchanged at 4.62% annually.

Although the President's speech was broadcast at night, during the day the versions regarding the fiscal announcements and the direction of the Government were consolidated. On the other hand, as the hours passed, some rumors about million-dollar aid packages that were almost closed to consolidate reserves began to dissipate.