'The party's on': investors buying up Argentine assets after Milieu's party's victory

Investors are buying up Argentine assets after the convincing victory of President Javier Milay's party in the midterm elections, Seeking Alpha reports. The results of the vote strengthened traders' confidence that Miley will continue the course of austerity and market liberalization, and his reforms will not be blocked in Congress, Bloomberg adds.

Argentine banks Banco BBVA Argentina, Grupo Financiero Galicia and Banco Macro were among the leaders of growth on preliminary trades in the USA on October 27, shares of which soared by about 35%. Shares of state-owned oil and gas company YPF S.A, energy company Pampa Energía and power distribution company Empresa Distribuidora y Comercializadora Norte each added about 25%. Online retailer and fintech platform MercadoLibre rose nearly 7%, real estate developer and investment company IRSA gained 19% and oil and gas company Vista Energy rose 21%.

Following the shares, Argentine bonds also rose in price, becoming the leaders of growth among the debts of developing countries, notes Bloomberg. Thus, the cost of dollar bonds maturing in 2035 rose by more than 13 cents to 70.34 cents per $1 face value.

In Argentina's midterm elections, half of the lower house of Congress and a third of the Senate were re-elected. The Milea La Libertad Avanza party showed a result that exceeded even the most optimistic forecasts: after counting more than 90% of ballots, it received 41% of the vote, winning 64 out of 127 seats in the lower house and 13 out of 24 in the Senate. By comparison, analysts expected about 30%, emphasizes Bloomberg. The opposition Peronist coalition won about 31% of the vote.

Voters supported Javier Miley's course of austerity and market liberalization, Bloomberg noted. The convincing victory puts Miley's party "in an advantageous position to negotiate and promote reforms," said Joaquin Bages, manager of Grit Capital Group. - The party can be considered to have begun."

The election results have also increased confidence that Argentina will continue to receive financial support from the US. On the eve of the vote, Donald Trump's administration signed a $20 billion currency swap with Argentina's Central Bank and discussed an additional funding package for the same amount. Trump said receiving another $20 billion would depend on the outcome of Argentina's midterm elections. "If he [Ma] wins, we're in, if not, we're out," the US president bluntly stated.

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