Markets: stocks and bonds deepen the decline and the country risk is close to 2,000 points

The external trend deepens the loss for Argentine assets

The Argentine stocks and bonds fall sharply this Monday, waiting for signals about the Government debt negotiation with the Fund International Monetary Fund (IMF), in a key week due to the expiration of some USD 730 million to the organization on Friday 28.

At the global level, indicators of Wall Street deepened declines exhibited since the beginning of the year, pending the result of corporate balance sheets, while the possibility of a Russian invasion of Ukraine – although Moscow denies any invasion plan – hit the emerging markets of Europe, the Middle East and Africa.

the leading index S&P Merval of the Buenos Aires Stock Exchange loses 3.5%, in the 80,700 units, at 2:50 p.m., after accumulating a drop of 2.2% in pesos and 7.8% in dollars last week, led by the trend in financial actions.

“The eye during the week will be on any sign of progress in the negotiations or references to Friday’s payment that, if carried out, would set a good sign in terms of the will to close an agreement”, indicated the SBS Group in a market report.

Sovereign bonds resumed declines. The titles Global swaps subtracted another 2% this Monday, with a risk country of JP Morgan that increased by 53 units for Argentina, to 1,969 points basic, at maximum since the sovereign restructuring.

The Argentine government will also have to pay some USD 365 million to the International Monetary Fund (IMF) on February 1, before a heavy maturity of some USD 2.9 billion in March, with a Central Bank with little reserves.

“The upward rearrangement of financial and free dollars is accelerating, since the lack of signs of progress in the negotiations” between Argentina and the International Monetary Fund “does nothing more than incline operators more and more towards hedging as a response defensive in the face of such uncertainty”, described the analyst Gustavo Ber. He added “the monetary issue, the deterioration in reserves and inflation without respite.”

The analysts of Research for Traders They explained that the bonds yield “in the midst of uncertainties in the negotiations between Argentina and the IMF to restructure the debt with the organization. Investors fear that a deal with the Fund may take longer than anticipated and extend beyond the first quarter of 2022.”

“But if this happens, Argentina would not meet the debt maturities with the agency that it has to face between now and March, and the reserves are at too low levels,” they said from Research for Traders.

The bonds in dollars issued with the debt swap fall 12% on average in this January 2022, at their lowest prices since they went on the market. Some titles, such as the Global 2035 and 2046 (GD35 and GD46) with foreign law, are already paid in the USD 28 zone, like the Bonares 2030 and 2035 (AL30 and AL35), with Argentine law


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