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Summer Star: Why the stock market reached 20% in January



During 2018, Argentine assets within the emerging market group were penalized by capital influx, with expectations for interest rates to rise in the United States. In addition, they led the group, with the Argentine peso devaluing slightly more than 100%. On the stock market this exchange turbulence was generated and loss of 50% of Mervalu value in 2018.

Meanwhile in January, the month that has now left the round to mark the official closure, the head of the Stock Exchange S & P Merval) climbed to 36,039 points. As for the starting point of the year when the total offer of private shares reached 30,292, the increase was 18.9%. In the dollar, this jump was 19.7 percent,

Analysts point out that in the current context of "good financial reports," consisting of a stable exchange rate, low interest rates and country risks that have declined for most months, Merval's data becomes a star this summer, mainly motivated by external factors.

The closing of the round yesterday led to an increase of 1.5% on Tuesday, driven by the growth of Supervielle Group (4.19%), Aluar (3.49%), ByMA (2.83%), French banks (2.54% ) and Tenaris (2.29%), according to data from the Argentine stock exchanges and stock exchanges.

On the foreign market, however, the Argentine ADR, Wall Street, Supervielle (3,8%), and MercadoLibre (3,1%) have seen similar increases.

"Argentina is linked to the improvement of markets that are reflected in the international scenario. January for the emerging countries in general was a very good beginning of the year caused by the US Federal Reserve Reporting, "he explained. Fernando Baer, ​​analyst at Quantum Finanzas, The latest news from the US monetary authority raises expectations on the international market in 2019 with a smaller increase in benchmark rates.

In this sense improving conditions for emerging markets has been an additional factor for Argentina, assuming that Jair Bolsonaro is President of Brazil, according to Christian Buteler, from Buteler Servicios FinancierosThe analyst expects the Bolsonaro effect will positively affect the region after 2018, when Latin America was one of the most affected areas.

Among the other variables, positive international influence can be noted in the declining trend that took place in the first three months of this year, despite the fact that the last three rounds increased the government bond premium. "In general, there is a tendency for a negative correlation between the risk of the country and the price of Merval: when it goes up, the other tends to fall and vice versa, "commented Amilcar Collante of CESUR (Center for Economic Studies in the South).

The economist believes that the risk of an aggravating country benefits large companies with access to international markets. Many of them are listed on S & P Mervalu. "We are now in the process of returning to the middle, the market was expecting deficiencies at the time, and now it does the same," Collante added.

Analysts do not rule out a possible turn, as the political factor, the presidential election, starts to appreciate more. "On the domestic side, macroeconomic problems did not disappear," Buteler concluded, "there has been no major change in the type of change that has been settled."


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