Big Wall Street investors are returning to Argentina. What stocks are they buying?

Foreign investors, including billionaire Stanley Druckenmiller and major Wall Street banks, are once again stepping up investments in Argentine stocks after the victory of President Javier Milay's coalition in the midterm elections. Investors are counting on the continuation of his economic reforms and a possible rise in the status of the Argentine stock market.

The inflow of funds into the Global X MSCI Argentina ETF, which is the main instrument for foreign investment in Argentine shares, has amounted to $63 million since the beginning of the year, Bloomberg reports. The growth of interest is connected, among other things, with expectations of June change in the status of the country's stock market according to Morgan Stanley. Now Argentina belongs to the category of isolated markets of MSCI - this limits the inclusion of its securities in international index strategies. Despite this, the fund's assets have grown by about $500 million since the beginning of the first full year of Miley's presidency, Bloomberg notes. If Argentina gets a higher status, it could lead to automatic inflows from passive funds, the agency writes.

Billionaire Stanley Druckenmiller's investment fund Duquesne Family Office bought $128 million worth of shares of state-owned oil and gas company YPF in the first quarter and increased its position in the oil producer Vista Energy and MSCI Argentina ETF, according to a report to the regulator. Morgan Stanley, UBS and Goldman Sachs also increased investments in this ETF, JPMorgan bought shares of Vista Energy and Citigroup invested in the country's largest private bank Grupo Financiero Galicia, Bloomberg listed.

Investor interest is also confirmed by the growth of the stock market: the S&P Merval index added almost 10% in May. Since the victory of Milei supporters in the midterm elections in October 2025, it has soared by 54%.

Improved sentiment in financial markets has not yet led to a large-scale inflow of direct investment in the real economy of the country. The energy and mining sectors are the most actively developing, while construction and industrial production remain below the levels seen before Miley came to power, notes Bloomberg.

Expectations for economic growth also remain subdued. That's why Argentine government bonds have been trading mostly flat this year after a jump at the beginning of President Milieu's term, the agency explains.

In 2025, the volume of foreign direct investment in Argentina amounted to $3.13 billion. With this indicator, the country ranked last among the largest economies in Latin America, notes the Argentine publication Perfil. Investment activity is constrained by falling domestic consumption, reduced infrastructure spending by the state, lack of production credits and strengthening of the national currency, worsening the position of Argentine exporters.

"Most interest is centered in equities rather than Argentine bonds, as investors see much more upside potential in securities such as YPF, Vista or [the country's largest independent company] Pampa," Alberto Ades, head of research and strategy at hedge fund NWI Management, told Bloomberg.

Investors are already pricing in a possible upgrade of Argentina's status in the MSCI system, according to Daniel Chodos, partner at Dhalmore Capital. "As a rule, active investment funds try to take positions before it happens officially," he said.

The most optimistic assessment was given by Morgan Stanley's Latin American markets strategist Nikolai Lippmann. According to his calculations, if Argentina gets the status of an emerging market in the future, local stocks may attract about $5 bln of new investments. "If it will be possible to ensure the sustainability of economic policy after 2027, the country may receive significant capital from the energy and mining sectors, as well as from global financial markets," he predicts.

This article was AI-translated and verified by a human editor