Without a local market, Argentine shares in NY They ended the short week in negative. While Wall street It gained as much as 1.50%, despite the negative indicators coming from the coronavirus pandemic, the local papers returned to negative territory. They lost 2% on average with even much higher declines.
By case, Edenor yielded 5% and America Corporation 4.2%. Anyway, like the New York Stock Exchange, there is a recovery so far in April after losses of up to 60% in ADRs.
Thus, the main closings of this short week and the accumulated so far this year are as follows:
- Edenor lost 5% on Thursday and yields a total of 5.5% in April
- Central Puerto gained 5.7% on Thursday and climbs 16% in the month
- Tenaris lost 2% but rises with an improvement of 8% this month
- Take off this wheel won 3.5% and is appreciated 37% in April
- Free market yielded 2% on Thursday but gains 9.2% in the month
In regards to risk country, on the last trading day of the week lost 1.5% and hardly moved in the month. Of course, so far this year it shot up with a rise of 118% and is currently listed at 3,858 units.
“The local fixed income continues to suffer the consequences of the postponement of the payments in dollars of the local law bonds. This caused different risk rating agencies to lower the rating of the country. The prices of the public securities, whatever their legislation, are adjusting to the new rating that made some institutional investors have to sell their positions since they cannot, by regulation, be invested in assets whose issuer is in selective default, “he says Joaquín Candia, of Rava Sociedad de Bolsa.
On the other hand, he adds, debt in pesos continues to be a problem for the government, “since it is expanding the monetary base in order to finance the necessary expenses to face the economic crisis and to this is added the commitments assumed with the creditors“
SBS Group He says that Argentine assets received a deep blow that left attractive valuations in some spaces. For dollar investments, they continue to recommend Global 2021-16 tranches as they see an attractive time to add exposure to corporate debt through common funds.
“In addition, we are facing a favorable entry point to increase exposure to shares through our SBS Shares Argentina FCI, but we consider that several factors suggest that it is time to maintain low exposure to investments in pesos,” they indicate.
For Christian Reos, boss Allaria Ledesma, the stock market remains at a low volume. “The government announced the guidelines that it will use to remunerate electricity generation, now it will have to resolve if the Creole barrel returns, to subsidize oil production,” he said.
“The potential to rise in equities is very high, but it is tied to investors becoming interested in Argentina again, for which a reasonable resolution on the debt issue is needed.“, it states.
The greatest potential to rise is still seen in banks and public services. “We also like Agro Mills in food, Irsa in real estate. We are indistinct between Black Hill Y Ternium Argentina in materials. Corp America Airports, for obvious reasons, looks attractive again, “he predicts.
Capital Markets Argentina (CMA) said that local performance continues to be linked to the volatile dynamics of global markets. “Higher volatility and flight to quality negatively affected local assets, although the drop showed a very high beta compared to developed markets due to the weakness of local macroeconomic fundamentals.“he maintains.
The sharp drop in oil mainly affects YPF (YPFD), since the current price of a barrel is below the cost of production of the company (US $ 35-40). “However, it could benefit from the support of local fuel prices by the Government, since its production is entirely destined to supply the local market. Furthermore, in the event of an agreement between Russia and Saudi Arabia, the situation international could favor it “, indicates CMA.
Companies linked to tourism and passenger transport, including Despegar.com (DESP) and Corporación América Airports (CAAP), continue to be among the most affected group.
“We continue to favor defensive papers whose revenues are in hard currency, such as San Miguel (SAMI), as well as CEDEARS with reduced exposure to the Argentine market, such as Free market (MELI) and Globant (GLNT). Argentine Stock Exchanges and Markets (BYMA) are also attractive at these prices, thanks to their investment portfolio in foreign instruments. In the current context, Telecom (TECO2) stood out in recent weeks for being a stable business and a defensive role, while the company has an attractive dividend yield“reaffirms the stock market.