EM LATAM CREDIT: Republic of Argentina (ARGENT; Caa3pos/CCC/CCC): Budget Surplus
“The Government achieved a primary surplus of ARS745.339 billion in March” – Ambito
Supportive for prices
• The primary budget surplus of ARS745bn (USD621mn) was .1% of GDP, lower than February’s nearly ARS1.2tn (USD981mn) or .2% of GDP.
• Net of interest payments on public debt, the March financial surplus was ARS398.909bn.
• For the first quarter 2025, Argentina had a primary budget surplus of .5% of GDP with the government targeting 1.6% of GDP for the year.
• The IMF is expecting a primary surplus of 1.25% for 2025 and 2.5% over the medium term with real GDP for 2025 projected to grow 5.5% and converge to 3% in the medium term.
• ARGENT 2035s were last quoted USD65.25, up slightly today. The bonds were about 2 ½ points higher since March 2025 month end and about 4 points away from the peak of USD69 January 2025.
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US DATA: GDPNow Seen At -2.1% For Q1, Gold-Adjusted Estimate Mar 26
- The Atlanta Fed’s GDPNow for real GDP growth in Q1 was revised up to -2.1% from -2.4% in its Mar 6 update, although it marked a downgrade from the -1.6% tracked inter-released after the payrolls report of Mar 7 (as noted in the LinkedIn post from Atlanta Fed’s Higgins mentioned earlier).
- Today’s retail sales report, which as we noted showed signs of weak discretionary spending, has offset the inter-release upside seen post-payrolls for consumer spending. Compared to the -2.4% in the last 'full' release, the upward revision has come from a larger positive contributino from non-resi investment growth and changes in inventories.
- The LinkedIn post had also showed a gold-adjusted figure of +0.4% vs the -1.6% in that inter-release update. However: “Due to FOMC blackout policy, today’s post does not include an update of the version of the model described here that adjusts the standard GDPNow model forecast for foreign trade in gold. That adjusted model will again be updated after our first scheduled post-blackout update on March 26.”
US STOCKS: Midday Equities Roundup: Energy & Estate Management Leading
- Major U.S. stock indexes are trading mixed, the SPX Eminis near steady while the DJIA outperforms modestly weaker Nasdaq at midday. Currently, the DJIA trades up 188.34 points (0.45%) at 41678.97, S&P E-Minis up 6.75 points (0.12%) at 5699.5, Nasdaq down 81.7 points (-0.5%) at 17673.26.
- Energy and Real Estate sectors outperformed in the first half, oil and gas stocks leading gainers as crude prices rebounded (WTI +.41 at 67.59): Marathon Petroleum +2.61%, Targa Resources +2.45%, APA +2.37% and Valero Energy +2.13%.
- Investment trusts and management shares buoyed the Real Estate sector: BXP Inc +5.24%, Simon Property Group +2.55% and Iron Mountain +2.02%.
- On the flipside, Consumer Discretionary and Information Technology sectors underperformed in the first half, Tesla -6.44%, Ulta Beauty -2.25%, Garmin Ltd -1.85% and Deckers Outdoor -1.60% led laggers in the Discretionary sector.
- Despite strong gains by Intel +7.88% and Enphase +6.47%, the Tech sector underperformed as a whole with Super Micro Computer-1.92%, NVIDIA -1.71%, Broadcom -1.52% and Apple -1.36%.
AUD: Bullish Break of 100-dma Would be First in Over 6 Months
Despite the greenback recovering off lows against most others in G10, AUD/USD is still well bid - pushing the pair to a new daily high through the London close. This narrows the gap with 0.6409 - the bull trigger.
- Firmer commodity prices have given the currency the last leg higher, as Trump's more aggressive language on Iran underpinned the oil rally. Another factor making today's break higher in AUD/USD notable is the rally (and likely close) above the 100-dma at 0.6347. This level held well and contained price action back in late February as well as during the sell-off in November of 2024 - a confirmed break and close above this week would be the first since over six months.
