Bargain shopping for oil companies in Buenos Aires stock market

Friday, August 31st 2018 - 08:06 UTC

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The Argentine stock market witnessed another strong increase with the Merval index up 5.3% reaching 26.754,85 points , boosted mainly by the oil industry stocks

While the foreign exchange market in Argentina experienced a chaotic Thursday with no ceiling for the US dollar as locals dumped their Argentine pesos, the Argentine stock market witnessed another strong increase with the Merval index up 5.3% reaching 26.754,85 points, boosted mainly by the oil industry stocks.

In effect Petrobras and Pampa Energia shares soared 13.5% and 9.7% respectively, while those power companies linked to public rates such as Gas Cuyana, Edenor and Gas del Norte were down on average 3.5%.

The overshooting of the US dollar (15.6%), as a reflection of the current lack of confidence in the overall economy of Argentina, did not prevent a strong demand for oil companies, taking advantage of that 15% difference in a single day.

Following on Thursday's tumultuous market session Argentina's country risk climbed to 776 points (up 6.59%), which is the highest since president Mauricio Macri took office in 2015.