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 News

19/09/2017 0:00 - Capital Market
NICOLAS FERRER
Local stocks take a breather from their 4-week rally

After setting record highs after four weeks of consecutive rises —even in spite of a stronger peso—, the Merval Stock Index pared back its month-to-date gains after light profit taking in order to close the week.

In the four-week period between August 7 and September 4, the Merval Stock index gained 11%, breaking the resistance level located at 22,600 points. The rally was consolidated by a significant uptick in volume, particularly on August 14, when around ARS 1,030 million were traded, barely below the record high for the year that took place on June 21.

 

The fact that this rally took place in spite of a stronger peso amplifies profits in dollar terms. In the same four-week period (August 7 to September 9), the official peso – US Dollar exchange rate fell 2.6%. Even if the Merval stock index has dipped throughout the first weeks of September, a further drop in the value of the US dollar against the peso has ensured that the leading stock market index remains near record highs in dollar terms.

 

Even if dollar-denominated sovereign debt bonds have taken a hit from the recent surge in the value of the argentine peso, its performance in dollar terms has followed the uptrend in stock markets. Bonar 2024 bonds have once again started to yield below 5%, whereas Discount bonds’ yield have reached a new 52-week low. The following chart shows the evolution of yields on these two popular bonds since early 2016.

 

Looking ahead to the following week, all eyes are set on the next Central Bank of Argentina bills auction that will take place on September 19. According to data from the Central Bank, a total ARS 484,211 million (which represent 46.5% of all outstanding bills) are due to mature on September 20. Recently, by maintaining its objective rate stable, the monetary authority has shown that it is willing to hold a contractive policy. Core inflation has remained close to 1.5%, strictly above target range, which has in turn forced the Central Bank to hold high interest rates. However, the recent surge in the peso could help the entity to release some liquidity without having to worry about the exchange rate reaching unfamiliar waters

 

 Institutional video


Institutional Video of the Bolsa de Comercio of Rosario (Rosario Board of Trade)

 Rosario Board of Trade

The Rosario Board of Trade is a centennial institution located in Rosario, in the most important agroindustrial zone of Argentina. Throughout its history it has created and boosted transparent, solid and reliable markets: the Grains Physical Market, the Futures Market, the Capital Market, and the Livestock Market.

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Bolsa de Comercio de Rosario Córdoba 1402 - S2000AWV
TE: (54 341) 5258300 / 4102600
TE: (54 341) 5258325 (Complejo de Laboratorios - servicioalcliente@bcr.com.ar)
Rosario - Santa Fe - Argentina

Oficina Buenos Aires Reconquista 458 piso 7° - C1003ABJ - Cdad. de Buenos Aires.
Tel: (54 - 011) 43280390/1484 43939391/9649- Fax: (54 - 011) 43939649
contacto@bcr.com.ar