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The summer star: why the stock market rose 20% in dollars in January



During 2018 Argentine assets were within the group of emerging markets punished by the exit of capital with expectations of increases of interest rates of the United States. Moreover, they led the group, with the Argentine peso devaluing slightly more than 100%. In the stock market place, this currency turbulence generated one loss of 50% in the value of Merval throughout 2018.

As far as January, the month that remains the wheel of today to mark an official closing, the leading panel of the Stock Exchange (the S & P Merval) climbed to 36,039 points. Regarding the starting point of the year, when the total price of private shares reached 30,292 units, the increase was 18.9%. In dollars, that jump was 19.7 percent.

Analysts point out that in the current context of "good financial news" composed of a stable exchange rate, lower interest rates and a country risk that most of the month showed falls, the Merval data stands out as the star As far as summer is concerned, mainly motivated by external factors.

The yesterday's wheel closure marked an increase of 1.5% compared to Tuesday, led by increases in Grupo Supervielle (4.19%), Aluar (3.49%), ByMA (2.83%), Banco Francés (2.54%) and Tenaris (2.29%), according to data from Bolsas y Mercados Argentinos.

In the foreign plaza, meanwhile, Argentine ADRs, certificates of holding shares listed on Wall Street, showed similar gains, with Supervielle (3.8%) and MercadoLibre (3.1%).

"Argentina is engaging in the improvement of markets that is seen on the international stage. January for emerging people in general was a very good startup of the year shot by the rates ads by the Federal Reserve of the United States, "he explained Fernando Baer, ​​Quantum Finance analyst. The latest communications from the US monetary authority generate an expectation in the international market of 2019 with fewer increases in reference rates.

In that sense, the improvement of conditions for emerging markets had an additional factor for Argentina in the assumption of Jair Bolsonaro as president of Brazil, according to Christian Buteler, from Buteler Financial Services. The analyst hopes that the Bolsonaro effect will positively influence the region after 2018 in which Latin America was one of the most punished areas.

Among other variables, the positive international influence can be seen in the downward trend that the country risk showed during the first weeks of January, although in the last 3 wheels the bonus applied to sovereign bonds showed rises. "In general, There tends to be a negative correlation between country risk and the Merval quote: when one goes up, the other tends to lower and vice versa, "said Amilcar Collante, from CESUR (South Economic Studies Center).

The economist considered that a country-down risk benefits large corporations with access to international markets. Many of them are quoted on S & P Merval. "We are now in a process of returning to the average, the market was anticipated to decline in its moment and now it is doing the same thing rising," added Collante.

Analysts do not rule out a possible turning point as the political factor begins, even more so, that is, the presidential elections. "In the internal front, the problems at the macroeconomic level did not disappear. Beyond a type of change that was leveled, there were no major changes," said Buteler.


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