LOCAL ASSETS POSTED A SESSION OF BROAD GAINS, driven by two catalysts: Fitch's upgrade to B− with a stable outlook, and improved global sentiment following progress in US-Iran negotiations. Both factors boosted dollar-denominated sovereign bonds, pushing country risk lower, and sustained a favorable session for peso-denominated debt. The official exchange rate continued to decline as the BCRA kept accumulating foreign currency, albeit at a slower pace.

FITCH PUBLISHED ON TUESDAY THE UPGRADE OF ARGENTINA'S SOVEREIGN CREDIT RATING FROM CCC+ TO B−, with a stable outlook — the first step into single-B territory under the current cycle. The agency highlighted the structural improvement in the external and fiscal balances, and recognized the impact of the October 2025 midterm elections, which expanded the government's legislative capacity to advance key reforms such as labor and mining deregulation. Fitch also acknowledged improved prospects for international reserve accumulation. The "stable" outlook signals that the agency does not anticipate near-term changes, though it cautioned that vulnerabilities remain, including the level of net reserves, inflation, and the country's history of macroeconomic instability.

DOLLAR-DENOMINATED BONDS ADVANCED AROUND 1.5% ON AVERAGE, buoyed by the combined boost of Fitch's upgrade and the improved global backdrop tied to progress in the US-Iran truce, which lifted risk sentiment for emerging market debt broadly. The long end of the curve led the way: Globals and Bonares maturing between 2035 and 2041 gained between 1.8% and 2.3%, with GD38 and GD41 posting the sharpest gains, while the short end rose up to 1.0%. Country risk fell 43 bps and closed at 515 bps. Bopreal bonds traded virtually unchanged, with moves between 0% and 0.2% across the different strips.

PESO-DENOMINATED DEBT HAD A FAVORABLE SESSION, with CER bonds leading gains, rising 0.7%. The fixed-rate curve followed with a gain of 0.6%, as rates compressed across the curve (between 1.9% and 2.1% EMR). Dual bonds rose by the same amount, with the Tamar up to 23.4% NAR, while dollar-linked bonds edged up 0.2%.

THE OFFICIAL EXCHANGE RATE CLOSED AT $1,386.29, down 0.6% from the previous session, widening the gap to the top of the band — which stands at $1,714.28 for May — to 23.7%. The MEP dollar (GD30) traded at $1,427, falling 0.3%, and the financial dollar closed at $1,483, also down 0.3%. The spread between the financial dollar and the official rate remains around 7%, while the MEP-financial spread stands near 4%. The BCRA purchased USD 45M during the session, accumulating USD 185M in the first three trading days of May and USD 7,340M so far this year. Gross reserves fell by USD 233M and closed at USD 45,674M.

THE MERVAL ADVANCED 4.4% IN PESOS AND 4.7% IN DOLLAR TERMS, closing at USD 1,942. Gains were broad-based and clearly led by the financial sector — typical in a risk-on environment — followed by utilities and materials, while energy was the only sector that traded marginally lower. Among locally listed stocks, Banco Macro (10.7%), Banco Supervielle (8.1%), and Banco BBVA Argentina (8.0%) led the advances, while YPF (-1.4%) was the only notable decliner. Among ADRs listed in New York, the average rose 4.4%, with Banco Macro (10.8%), Ternium (9.6%), and BBVA (7.8%) as the top performers, while Vista Energy (-4.8%), AdecoAgro (-2.3%), and YPF (-1.3%) posted the largest losses.