Hours before Javier Milei's meeting with Donald Trump in Washington at 2 p.m. Argentine time, and awaiting any other announcement that paves the way for the October 26 elections, there is enthusiasm on Wall Street for domestic bonds.
Dollar-denominated debt securities rise more than 2% in New York, with transactions closing before the market opens.
Stocks, on the other hand, are not doing so well: they are showing falls of up to 3% (Banco Macro), after the increases of up to 9% they experienced on Monday.
"The accumulated figures for the last five days show vertical increases in the case of banks of around or over 20%. However, to put the volatility levels we have been dealing with into context, it must be noted that, even so, in these cases the accumulated figures for the year continue to be negative by well over 40% compared to global and regional indices that are quite positive over that time period," explained the Outlier consultancy.
On Monday, despite the Columbus Day holiday in the United States, Argentine company stocks traded normally in New York, but there was no activity in fixed-income (bond) markets, and therefore no change in the country risk, which stands at 932 basis points. This is the rate difference that Argentine bonds must pay compared to those of the United States.
The expectation for new announcements following the meeting between the presidents comes after U.S. Treasury Secretary Scott Bessent officially closed negotiations for a $20 billion currency swap, with a mechanism that has not yet been specified. He also announced direct intervention in the local foreign exchange market through the sale of dollars and the purchase of pesos. This operation, which took place last Thursday, returned Argentine assets to a favorable climate.
"Once the US Treasury's support is formalized, we could have some further definition from the IMF, since it seems quite evident that the terms of the extended facilities program (EFF 2025), particularly the fiscal and reserve targets, will have to be, at the very least, recalibrated. Although, again, it is likely that this will be left for after the elections," Outlier added.
