Argentina’s financial markets displayed mixed reactions on Monday. The peso experienced a slight weakening, while stocks edged higher and bond prices saw gains. This market behaviour is largely attributed to anticipation surrounding potential financial aid from the U.S. Treasury, coupled with escalating political tensions ahead of the country’s midterm elections later this month.
International dollar bonds saw increases ranging from 0.7 to 2.5 cents across various maturities. Sovereign bonds in the local market also rose, averaging a 1.2% increase. Traders attributed this rise to portfolio restructuring in response to speculative buying. Meanwhile, the interbank peso depreciated by 0.35%, settling at 1,429.5 per dollar, and the S&P Merval stock index experienced a marginal uptick of 0.3%.
Economy Minister Luis Caputo has been in Washington seeking a multimillion-dollar currency swap with U.S. Treasury Secretary Scott Bessent, aimed at bolstering investor confidence. AdCap economist Roberto Geretto noted that the market is awaiting concrete details about the loan or program to alleviate tensions and ensure the financial program’s stability, regardless of the election outcome. Political turbulence continues as a leading candidate from President Milei’s party resigned due to scrutiny over ties to a businessman under investigation in the U.S.
