Argentine S&P Merval Hits Technical Bear Market as ADRs Rise 6%, Peso Hits AR$1,280; BCRA Intervenes

The Argentine S&P Merval index experienced notable volatility in recent weeks amid fluctuating global market conditions and domestic political developments. The index climbed 4% with individual stocks rising over 8% ahead of a key MSCI decision, supported by positive momentum from Wall Street. ADRs (American Depositary Receipts) also gained, reaching increases up to 6%, while dollar-denominated bonds rebounded following a favorable court ruling in New York related to YPF. However, the S&P Merval in dollar terms declined nearly 4% amid uncertainty surrounding congressional decisions. The index is currently considered to be in a technical bear market, prompting investors to seek entry opportunities anticipating potential rebounds. Concurrently, the Argentine peso came under pressure, hitting a record exchange rate of AR$1,280 per US dollar after a setback in the YPF trial, which heightened political tensions. In response, the Argentine government intervened by absorbing pesos and the Central Bank of Argentina (BCRA) reactivated the use of passive repos (Pases Pasivos) and raised interest rates to stabilize the currency. These measures helped the official dollar rate retreat from the AR$1,300 mark, signaling a temporary halt to the currency's sharp rise.