ARGENTINE ASSETS HAD ANOTHER TOUGH SESSION, as hard-dollar sovereigns lost ground and country risk climbed again, diverging from emerging market debt, which traded higher, amid persistent selling pressure. The peso curve traded without clear direction, the exchange rate edged higher on fresh BCRA purchases, and equities closed broadly lower.
HARD-DOLLAR BONDS ENDED WITH AN AVERAGE 0.1% DECLINE, bucking emerging market debt, which rose 0.5%. Bonares slipped 0.1% and Globales ended practically unchanged, with no clear pattern across tranches: the 2035s and 2041s gained up to 0.5%, while the 2029 tranche and the longest New York law bond fell up to 1.1%. Country risk jumped 41 bps to close at 702 bps. Bopreal, measured in MEP dollars, rose 0.3%.
PESO CURVES ENDED LOWER IN USD TERMS, led by dollar-linked bonds, which fell 0.7% in USD terms, dragged down by the short end, followed by CER-TAMAR duals, down 0.4% in USD terms. CER bonds ended slightly lower in USD terms (-0.2%), as a modest gain in the short end was offset by weakness in the long end, while fixed-rate and TAMAR instruments were down slightly (-0.2%) in USD terms. Overnight rates showed no significant changes, with the 1-day repo rate at 20.5% NAR.
THE OFFICIAL EXCHANGE RATE ROSE 0.1% TO $1,527.9, bringing its October gain to 0.7%. In the financial segment, the MEP dollar advanced 0.1% to $1,549.2, the CCL dollar rose 0.2% to $1,642.4, and the spread stood at 6.0%. Separately, the BCRA bought USD 61 million on the day, bringing its October total to USD 1,210 million and its year-to-date total to USD 15,790 million. Meanwhile, gross reserves fell USD 59 million to close at USD 50,166 million.
THE MERVAL CLOSED WITH BROAD-BASED LOSSES ON THE BLUE-CHIP PANEL, as only a handful of stocks managed to close in positive territory. The steepest declines were concentrated in telecoms, utilities, oil, and banks, while aluminum and real estate bucked the trend. On the local panel, Aluar (+2.0% in USD terms), IRSA (+0.9% in USD terms), and Mirgor (+0.7% in USD terms) led the gains, while Telecom (-3.9% in USD terms), Central Puerto (-3.6% in USD terms), and Sociedad Comercial del Plata (-3.2% in USD terms) led the declines. On Wall Street, ADRs fell 1.4% on average. Bioceres (+6.2%), Globant (+5.2%), and Adecoagro (+3.5%) led the gains, while Ternium (-6.4%), Corporación América (-3.9%), and Central Puerto (-3.7%) were among the decliners.
UTDT'S CONSUMER CONFIDENCE INDEX ROSE 0.8% M/M IN OCTOBER TO 41.5 POINTS, although it remains 1.9% below year-ago levels. The improvement was driven by the assessment of the present situation, which rose 5.9% m/m, and above all by durable goods and home purchase intentions, which jumped 8.8% m/m. Expectations, however, fell back again (-2.6% m/m), a sign that households are not yet projecting a recovery. By region, the increase was concentrated in CABA (+6.8%), while confidence in Greater Buenos Aires and the interior was practically unchanged. By income level, confidence improved among higher-income households and fell among lower-income ones.
