Argentine Stocks Jump as Much as 4.7% on Wall Street
The J.P. Morgan–measured country risk stood at 597 basis points. Private analysts had expected inflation between 2% and 2.4%.
Quick overview
- Dollar-denominated bonds and Argentine ADRs saw gains of nearly 5% as Argentina's inflation rose slightly to 2.3%.
- Hard-currency bonds experienced modest advances, with the Global 2046 bond leading the way at +1%.
- Argentina's Economy Minister announced plans to repurchase sovereign debt and increase foreign reserves amidst a stable peso.
- In New York, Argentine ADRs continued to rise, with notable increases in shares of Ternium and Telecom Argentina.
Dollar-denominated bonds and Argentine ADRs extended their winning streak on Wednesday, with gains nearing 5%, while the country’s risk premium hovered around 600 basis points. The rally came as Argentina’s statistics agency, INDEC, reported that October inflation edged up slightly to 2.3%.
Hard-currency bonds posted modest advances, led by the Global 2046 (+1%), followed by the Bonar 2029 (+0.5%) and Bonar 2035 (+0.5%). The J.P. Morgan–measured country risk stood at 597 basis points. Private analysts had expected inflation between 2% and 2.4%.
Earlier this week, Economy Minister Luis Caputo told investors in New York that Argentina plans to repurchase sovereign debt and build up foreign reserves, even as the peso continues to trade within its managed band.
Equities and ADRs Extend Gains
In New York, Argentine ADRs continued to climb, with shares of Ternium up 4.7%, Telecom Argentina +3.5%, Grupo Supervielle +2.7%, Banco Macro +2.6%, and BBVA Argentina +2.2%.
On the local market, the S&P Merval index advanced 1% to 2,987,103 points, or 1.7% in dollar terms, reaching 2,038 points.
Global Market Context
Despite renewed optimism on Wall Street over a potential end to the U.S. government shutdown, tech stocks underperformed mid-session, leaving U.S. indexes mixed.
The Republican-controlled House of Representatives is set to vote Wednesday on a deal to restore federal agency funding and temporarily end the government shutdown that began on October 1.
A resolution would not only reopen key areas of the federal government but also allow the Labor Department to release delayed employment and inflation data—two critical indicators for investors and the Federal Reserve to assess the state of the U.S. economy.
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