LOCAL ASSETS CLOSED WITH A MARKEDLY POSITIVE TONE ON THURSDAY, driven by a strong rally in dollar-denominated sovereign bonds following S&P Global's upgrade of Argentina's credit rating. May inflation data also came in better than expected. ARS-denominated debt joined the advance, with Lecaps and CER bonds closing higher. Financial exchange rates were mixed, while the official rate declined. The BCRA completed another net-buying session. Equities posted one of their strongest sessions in recent memory, led by the financial sector.
DOLLAR-DENOMINATED SOVEREIGNS HAD A STANDOUT SESSION, with the HD Index advancing 2.5% and country risk compressing 60 bps to 443 bps. Gains were concentrated in the long end: AL35 rose 3.4%, GD35 gained 3.2%, and GD41 added 3.1%, while the short end showed more modest moves — AO27 gained 0.1% and GD29 rose 0.3%. BOPREALs edged down 0.3%.
ARS-DENOMINATED DEBT POSTED A POSITIVE SESSION ACROSS MOST SEGMENTS. Lecaps rose an average of 1.2%, with the long end outperforming. CER bonds gained 1.1% on the index, with stronger moves in longer maturities. Dual bonds fell an average of 0.8%. Dollar-linked instruments declined in line with FX dynamics, with the index falling 0.5%.
THE BCRA PURCHASED USD 73M IN THE FX MARKET, accumulating a daily average of USD 91M so far this month. Gross reserves closed up USD 57M. The official exchange rate closed at ARS 1,429, falling 0.5% from the previous session. Financial rates were mixed: the CCL retreated 0.9% to ARS 1,493 and the MEP held flat at ARS 1,452, with the spread compressing to 2.8%.
THE MERVAL ADVANCED 6.3% IN PESOS AND 7.2% IN DOLLAR TERMS, closing at USD 2,245. The session was broadly bullish: communications, banks, and real estate led sectoral gains with moves above 10%. Top performers included BBVA (+13.3%), Supervielle (+11.5%), and Banco Macro (+11.0%), while Mirgor (-3.0%) was practically the only name in the red. Among ADRs, the average rose sharply, with BBVA (+14.7%), Supervielle (+12.6%), and Telecom (+12.4%) leading the way; Globant (-1.4%) was the sole exception.
ON THE ECONOMIC DATA FRONT, MAY CPI ROSE 2.1% MOM AND 33.2% YOY, accumulating 14.7% in the first five months of the year. The reading came in below market consensus and marked a further deceleration from April's 2.6% and March's 3.4%. The standout was core inflation, which broke below the 2% floor to close at 1.9% — easing from 2.3% in April and its lowest reading since September 2025. Communications (3.4%) and Education (2.9%) were the categories with the highest contribution. At the other end, Clothing & Footwear (0.3%) and Alcoholic Beverages & Tobacco (0.8%) recorded the smallest increases.
