Argentina’s MERVAL Extends Rally to Fourth Day as Inflation Relief Bolsters Market

Argentina’s benchmark S&P MERVAL index climbed 16,160 points (0.71%) to close at 2,301,643.25 on May 14, 2025, marking its fourth consecutive day of gains.

The upward trajectory builds on the previous day’s robust 2.47% increase, extending the winning streak to a cumulative 10.95% gain over the four-day period.

Trading volume surged to AR$84.1 trillion ($76.45 billion), exceeding the 30-day average by 18%. This heightened activity confirms strong investor participation in the ongoing rally, though the index still sits 19.23% below its January 2025 all-time high of 2,867,774.50.

Technical indicators present a mixed picture with increasingly bullish undertones. The RSI stands at 53.152, having recovered from oversold territory to a neutral position.

Both Stochastic and StochRSI indicators flash overbought signals at 99.29 and 94.216 respectively, suggesting potential near-term resistance. The MACD remains negative at -12,821.52, offering a contrasting sell signal amid the rally.

Argentina’s MERVAL Index Shows Resilience

The price action shows decisive movement above the 50-day moving average of 2,114,385, confirming short-term bullish momentum. Moving averages display an evenly split outlook with six buy and six sell signals, reflecting the market’s transitional state following months of downward pressure.

April inflation data serves as the primary fundamental driver behind the upswing. The 2.8% monthly rate came in below the expected 3.1%, marking the fifth consecutive month of sub-3% readings.

This consistent improvement has lowered 2025 inflation expectations to 47%, dropping below the psychologically important 50% threshold for the first time since mid-2023.

Among the top performers, energy giant YPF continued its strong momentum, building on previous weekly gains. Export-oriented companies faced headwinds from U.S. tariffs, with steel manufacturer Tenaris falling approximately 15% and aluminum producer Aluar dropping nearly 30% from recent highs.

The market’s resilience comes despite ongoing currency challenges following April’s lifting of capital controls. This policy shift initially triggered a 17% MERVAL surge but created volatility as the peso fluctuated against the dollar.

Year-to-date, the MERVAL remains down 9.16%, though May performance shows an encouraging 8.79% gain. The recent four-day winning streak represents the longest sustained upward movement since early January.

Trading Economics forecasts the MERVAL to trade at approximately 2,027,484 points by quarter-end, with a longer-term projection of 1,787,713 in 12 months, suggesting potential volatility ahead despite recent stability.

The current technical formation indicates continued short-term momentum but warrants caution given the overbought conditions and mixed signals from longer-term indicators.