the local country risk already rises 115% in the year

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So far in March it has risen almost 70% despite being at exorbitant levels. The indicator is trading at almost 3,900 points. Falling Argentine stocks

Another fateful day in the finances for the Argentine assets that continue deepening the contagion of the global crisis by the coronavirus pandemic. In the first operations on Wednesday, the collapse of the flag oil company, YPF, once again stands out.

The ADRs of the company that Guillermo Nielsen manages lose almost 8% and are worth US $ 3.2. Landslides are also seen in IRSA (-12%), Banco Francés (-10%) and Edenor (-14%), among others. Clearly, this month of March is proving devastating for Argentine actions in the midst of this global crisis. They already carry losses of up to 60%.

Nor are Argentine bonds doing much better, which, for the worse, are about to break the 30% value barrier. From there, they are only instruments that can be purchased by vulture funds.

Also on another day of extreme nervousness for the markets, stocks fell as much as 7%. In the month, Argentina’s debt skidded up to 30%, precisely before the launch of the offer to restructure $ 69 billion in bonds.

Given this, the country risk rises 5.7% to 3,818 basis points. So far this year, the indicator prepared by JP Morgan has climbed 115.5% and almost 70% so far this month. This means that Argentina’s debt is worth almost nothing and that access to financing in the market is virtually zero.

The collapse is greater when it is seen that the country risk of Brazil is below 400 points or Mexico that has 350 units.

“The equation seems simple, as long as there is no evidence of a slowdown in new coronavirus cases, we will not be able to find a floor from where to start the recovery,” said Portfolio Personal Inversiones.

Of course the world doesn’t help at all. The main Wall Street indexes were collapsing at the beginning of the session on Wednesday, as the alarming signs of losses among the big companies of the United States overshadowed the effect of the numerous stimuli that the authorities launched to protect the economy.

The Dow Jones fell 1.048.69 points, or 4.94%, to 20,188.69 units; while the S&P 500 index fell 92.69 points, or 3.66%, to 2,436.50 units; and the Nasdaq index lost 432.47 points, or 5.90%, to 6,902.32 units.

This happens despite the fact that the central countries are launching measures to alleviate the economic recession. From Japan, through France and ending in the US, all governments announced forceful measures to overcome what may be a very recessive quarter for the private sector.

“There is still fabric to cut, especially in North America, since Congress must approve the package outlined by Mnuchin, which could reach $ 1.2 trillion, or almost 6% of GDP. In an election year, This stop in the Legislative Branch should not be taken for granted, but could generate some additional noise in the short term, “says Delphos Investment.

And on the other side of the Atlantic, against all precedent, Merkel says that Germany would consider issuing joint bonds by the countries of the European Union to fight the coronavirus.

“The last few days have been the scene of one of the biggest financial crises, exposing the degree of immediacy and interconnectedness of the economies. In this sense, Argentina is not isolated and has begun to suffer more directly from sanitary measures. external as well as local, “says Capital Markets Argentina (CMA).

Although a zero-rate global context is favorable to Argentina, the dimension that the crisis is taking also greatly violates the government’s fiscal capacity.
Although a drop in GDP was expected for this year, it was supposed to be accompanied by a heterogeneous recovery in the sectors. However, everything suggests that we are on the way to deepening the drop in activity with a strong impact on fiscal accounts.“added CMA.

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