01/07/2026 22:21 - Economia
After a exhilarating June, the Argentine market took a breather during the first trading session of July. The S&P Merval Index —the main benchmark for the Buenos Aires Stock Exchange— fell by 1.6% to 3,128,135.41 points. When measured in US dollars, the index dipped by 2.2%, settling at 1,994.84 units.
This movement is interpreted by analysts as a standard profit-taking strategy, where investors sell assets to realize gains after a significant upward trend. The pullback was felt across the board, especially in ADRs (American Depositary Receipts), which represent Argentine companies trading on Wall Street.
ADRs (American Depositary Receipts) are certificates that represent shares of a foreign stock. They allow US investors to buy shares of Argentine companies like YPF or Grupo Financiero Galicia directly on the New York Stock Exchange in US dollars.
The steepest declines on Wall Street included:
While equities were correcting, the sovereign debt market showed remarkable strength. Most Argentine Global Bonds closed with gains in New York, signaling sustained investor confidence.
Consequently, the Country Risk —a key metric measuring the probability of default compared to US Treasuries— dropped by two units to close at 424 basis points. This is the lowest level recorded since 2018.
This indicator has fallen 13.6% in June alone and accumulates a 25.1% decrease year-to-date, reflecting a rapidly improving perception of Argentina's economic stability.
The most significant news for international investors comes from S&P Global Ratings. The agency upgraded Argentina's long-term credit rating to B- from CCC+, aligning with a previous upgrade by Fitch.
According to analysts at Puente, this is a game-changer. Many global funds have regulatory mandates that forbid them from investing in countries rated below B-. With dual support from S&P and Fitch, Argentina is now eligible for a massive new wave of institutional capital.
The upgrade has triggered a compression of spreads (the yield difference between Argentine bonds and safer assets). These spreads have narrowed to just 98 basis points over the average of emerging markets, a stark contrast to the 255 basis points recorded at the start of the year. This represents the lowest spread level in a decade, validating the government's ongoing economic normalization efforts.
Despite the local correction, global markets provide a favorable backdrop. Historical data from Guardian Capital indicates that July is traditionally the best month of the year for the S&P 500. The index has seen 11 consecutive years of gains (2015-2025) in July, with an average return of 3.2%.
Furthermore, the S&P 500 closed the second quarter with gains exceeding 10%, a rare occurrence only seen nine times since 1950. In all previous instances, the third quarter never ended in negative territory, suggesting a potentially strong second half for global equities.
Sources: El Cronista, Puente Research, Guardian Capital
Alfredo S. Quiroga
