Tuesday, March 21

Bonds fell up to 3% amid internship in the ruling party by agreement with the IMF

Meanwhile, the dollar-linked sovereign tranche showed little activity, according to a report by the SBS Group, was neutral throughout the curve (yields fell -4.3% tna for TV22, -6.3% tna for T2V2 and -3% tna for TV23). On the other hand, the bonds in pesos with CER adjustment had a demand in the short section of 0.2% and in the middle of 0.5%. While the DICP and PARP bonds lost 1%.

“The market was affected by these internal government issues, which can affect the negotiations (with the IMF), or at least slow them down”said one trader, adding “profit-taking is unavoidable in this environment.”

On Friday, the president, Alberto Fernández, announced that the country had reached an understanding with the IMF to restructure debt payments of more than US$40 billion. However, on Monday Máximo Kirchner resigned from the presidency of the FdT bloc exposes the differences that persisted within the government coalition to reach an agreement with the body.

“Máximo Kirchner’s door slam is not surprising and is part of the complex path that the pre-agreement with the IMF must still travel. The treatment in Congress will surely be turbulent, forcing the Government to look for circumstantial allies to compensate for the potential loss of 18/20 field deputies and at least 5 senators”, highlighted from Delphos Investment.

The leading Argentine index S&P Merval rose 0.5%, at 91,329.18 points, after gaining 3% in the previous session and closing January with a rise of 8.9% (in pesos).

The best performances were posted by the shares of Transportadora de Gas del Norte (+5.5%), Grupo Financiero Valores (+3.4%) and Edenor (+2.3%).

Meanwhile, the papers of Argentine companies listed on Wall Street (ADRs) closed with the majority of increases. Tenaris (+6.2%), Edenor (+3.9%) and Ternium (+2.7%) stood out.

The volume traded on Cedears during the day rose 44% to $4,745 million, which represented 74% of that traded in equities. While $1,656 million in local shares were traded.

During last Friday and Monday, The markets had responded positively to the agreement with the IMF, but the resignation of the president of the ruling bloc of deputies revived the uncertainty.

“We believe that the IMF agreement will not be enough to restore (the country’s) access to the international capital market. Argentina will still need to restructure payments owed to private sector creditors that start to increase in 2024,” Moody’s said.