Markets: Fears for the banking sector on Wall Street drag Argentinian stocks and bonds down

Wall Street resumed the falls on Wednesday and drags international stock market assets. New York indicators fell to 0.9%, weighed down by the banking sector and the actions of the giant Swiss credit they fell by 25%.

In Argentina, the stock market dollar once again approached 400 dollars, while the index S&P Merval fell by more than 4% and lost almost everything he had won since the start of 2023given the growing fears about the situation of the banks and the day after the announcement by the INDEC of high inflation of 6.6% in February.

The leading repository S&P Merval Porteno fell 4.8%, at 209,824 units. The panel of flagship shares thus recorded a loss of 16.4% in pesos – and 20% in dollars “cash with liquid” – in five consecutive bearish rounds. The Merval maintains a gain of 3.8% in pesos in 2023, below inflation, and in dollars suffered a loss of 9.8%.

Among ADRs and stocks of Argentine companies traded in dollars in New York, recent declines have deepened, led by Banco Supervielle (-10.6%) and Corporación América (-9.3%).

Argentine dollar bonds also suffered market punishment. Global foreign exchange securities – in foreign law dollars – fell by 2.4% on average, while countries at risk of JP Morgan scaled for Argentina 74 units, at 2,397 basis pointsthe highest level since late November last year, after hitting an intraday high of 2,413 integers.

Global bonds have now turned negative so far in 2023, derailing plans to support prices through an ambitious official $1 billion external debt buyback plan announced on January 18. Last month alone, the Globals lost 15%, while country risk returned to its highest levels since November 28.

At the local level, in February, the retail price inflation (CPI) increased by 6.6% -above what the market expected of 6.1%- compared to January when it was at 6%. The division that registered the strongest increase during the month was Food and non-alcoholic beverages (+9.8%), mainly due to the increase in Meat and derivatives and Milk, dairy products and eggs. Similarly, for February 2022, retail inflation recorded a 102.5% year-on-year increase, the worst data recorded since 1992.

Among the macroeconomic data, it appears that as of March 15, Shell’s fuel price update was finalized. This is the fourth and final increase provided for in the agreement between the national government and the oil companies. For this reason, the values ​​will experience an increase of 3.8% on average at the national level. This increase follows those already made in December as well as in January and February, when the increase was 4%.

According to the ITE-FGA (Institute of Labor and Economy of the Germán Abdala Foundation), the economic activity index (IMA) recorded an increase of +2.1% over one year in January. “The dynamics of the first month of the year reflect a disparate trend in the components of the AMI where five of the nine components show a year-on-year decline or stagnation. By observing the monthly frequency indicator without seasonality, we see that in January the economy grew by 1.1% compared to December, maintaining the growth trend after a few months of contraction,” the institution said. .

On the other hand, according to the Argentine Petroleum Institute (IAE), oil production in January increased by 9.9% year on year, while gas production fell by 0.9% over the same period, in both cases due to the performance of unconventional Vaca oil. Muerta training. Conventional oil production, which accounts for 58.0% of the total, fell 3.0% year-on-year while unconventional oil, which accounts for 42.0% of the total, rose 30 0.0% compared to the same month of 2022.

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