2022 closes with extraordinary profits for the Buenos Aires Stock Exchange. Merval is up 134% in pesos on the year and 39% in the dollar version. In the shares of energy companies the jump exceeds 300%.
Among the newspapers that stood out the most in the Central panel were Transportadora Gas del Sur, which gained 339%, followed by YPF with 293%, Transportadora Gas del Norte with 269%, Transener with 227% and Central Puerto with 212%.
For Pedro Siaba Serrate, Head of Research & Strategy at Portfolio Personal Inversiones, “The Merval has been a good investment this year. Logically, not all the companies that make up the index have been ideal vehicles for 2022. Most companies in the financial sector, for example, failed to outperform inflation, hit by the peso debt crisis. companies related to the energy and utilities sector were the winners with the most promotions“.
Maximiliano Donzelli, Head of Research at IOL investoronline, explains that “Merval was among the best performing dollar markets of the year. It was not only the case of Argentina, some emerging commodity exporting countries, such as Brazil, also had an excellent performance. The war in Ukraine has generated a sharp increase in goods and exporting countries have benefited from it”.
In this way, the index that represents the companies of the Argentine market outperformed the increase in the dollar MEP, which was 68%. In turn, it has also beaten inflation in 2022, which is estimated to close at 95%.
Santiago Ruiz Guiñazú, Head of Equity Sales & Trading at Adcap Grupo Financiero, points out that globally “2022 was a year of very aggressive monetary contraction by most of the central banks of developed countries, which generated that companies which had benefited greatly during the pandemic to the exact opposite effect, because there was a very lax monetary policy at the time, they lose much of their value this year, as is the case with big tech companies.
In this context, “Argentina is playing its game and the market is disconnected from the rest of the world. Local stocks had historically low valuations and at Adcap we have always been positive; We said that a change in expectations was needed and that Argentine companies had great potential,” says Ruiz Guiñazú.
Even if the biggest gains are concentrated in energy80% of the stocks that make up the Merval index beat the financial dollar and 50% at Argentina’s high levels of inflation.
What will happen in 2023
“We believe this situation will continue in 2023 because Argentina continues to have very low ratings and that this year-end push generates good expectations for next year,” says the Adcap analyst.
For Donzelli, “there are a number of factors that make us think that the 2023 will also be a good year for Argentine equities“.
“Today, a large number of Argentine companies, especially in the energy sector, already have strong fundamentals and strong results, including companies such as Central Puerto (CEPU), Transportadora de Gas del Sur (TGSU2), Pampa Energía (PAMP) and YPF ( YPFD),” he notes.
“Besides we do a nod to companies that are regulated. Since it was possible to observe that the tariff adjustment, which had allowed an improvement in the income of several companies in the sector. Such are the cases of Transportadora de Gas del Norte (TGNO4) or Transener (TRAN),” he adds.
Donzelli reiterates that the Merval has risen by about 39% in dollars, “while the main US indices have fallen respectively between 19% and 33%”.
But not all news is good. “There is a certain dissociation between the performance of the Merval and country risk. While equities have rallied strongly, sovereign bonds, despite the rally they’ve had since October, are today below the price they started 2022 with. Everything that is variable income is differentiating due to a change expectations for the future” warns Juan José Vázquez of the Cohen group.
AQ
Source: Clarin
