Argentina’s Merval Drops to 2,972,629 as 3M Barrier Proves Stubborn

01 Market Snapshot

02 Equities — The 3-Million Revolving Door

The Merval Argentina today fell back below 3 million for the fourth time in two weeks, closing at 2,972,629 after briefly touching 3,027,219 in morning trading. This is part of The Rio Times’ daily coverage of the Argentine stock market and Latin American financial markets.

The pattern is now well-established: the index rallies above 3 million, fails to hold for a full session, and retreats. Monday’s rejection was the most emphatic yet — the index lost 78,449 points from its intraday high to close, a 2.6% peak-to-trough reversal that erased Friday’s entire recovery. The bearish candle (open above 3M, close well below) is the kind of session that shakes out weak-handed bulls.

At 2,972,629, the Merval sits 9.8% below its January 28 all-time high of 3,296,502. The MSCI Latin America index is up over 20% year-to-date — its best start since 1994 — yet the Merval has underperformed, weighed down by its 19.8x valuation, negative FDI, and persistent capital controls that prevent MSCI re-inclusion.

03 The Earnings–Valuation Tension

The fundamental problem remains unchanged: Argentine equities are priced for a growth story that the economy is not yet delivering. Inflation is down from 219.9% to approximately 31%, the fiscal surplus exists (though under pressure), and labor reform has passed Congress. But GDP growth has been cut to 2.0% (Bloomberg Economics), FDI turned negative (−US$1.52 billion in Jan–Nov 2025), and the two-speed economy — agriculture/energy thriving while manufacturing/construction/retail struggle — means the Merval’s earnings cycle is uneven at best.

One618 Research’s Carolina Volman captured the market’s dilemma: “Stocks need clear evidence of a second phase — sustained economic growth, earnings recovery, and greater regulatory predictability.” Q4 earnings reports are filtering through and will be the most important data point for the near-term direction. Banks and energy are expected to show strength; consumer and industrial names face headwinds from weak demand and the FATE plant closure template — companies that cannot compete with imports under Milei’s low-tariff regime.

04 Technical Analysis — Merval Daily

The chart shows the Merval oscillating around the 3-million level with the 50-day MA rising near 2,907,000 and the broader MA cluster at 2,862,000–2,888,000 providing layered support. The 200-day MA at approximately 2,505,000–2,521,000 is far below, confirming the secular uptrend. The upper Bollinger Band near 3,030,213 aligns with the repeated intraday highs, reinforcing that zone as the ceiling.

Notably, the MACD histogram has turned positive at 7,367 — despite the negative price action. The main line at 48,281 is above the signal at 40,914, and the histogram is expanding from the signal line crossover. This positive MACD divergence (rising momentum indicator vs. falling price) is often a precursor to a trend reversal. The RSI at 62.25 is elevated but not overbought, and the secondary oscillator at 53.76 is neutral. If the MACD continues to expand while price holds the 2,907,000 50-day MA, the setup for a sustained break above 3 million improves materially.

05 Key Levels

06 News in Focus

Privatization Calendar Tests Execution Risk

The privatization pipeline — freight rail, Buenos Aires water utility, postal service, and coal mining — is accelerating under Sturzenegger’s leadership. IMPSA (metallurgical) is complete, and privatization revenues may be critical to plugging the fiscal gap if tax receipts keep declining. Aerolíneas Argentinas, profitable for the first time since re-nationalization, requires separate congressional approval. YPF privatization remains complicated by provincial revenue-sharing agreements and U.S. litigation. The market is watching whether execution quality matches the ambition — the Menem-era privatization precedent, marred by corruption allegations, looms as a cautionary reference.

Vaca Muerta: The Bright Spot

Argentina ended 2025 with record oil production, driven by the Vaca Muerta shale formation. The RIGI investment incentive regime has attracted US$31 billion in announced mining commitments, and Argentine–German LNG cooperation is advancing. With Brent above $100, YPF and Vaca Muerta operators are generating strong cash flows. The energy sector remains the most compelling fundamental story within the Merval — but it is already priced into the 19.8x multiple. The question is whether the rest of the economy can catch up.

IMF Semi-Annual Review Approaching

The IMF’s semi-annual review of Argentina’s US$20 billion Extended Fund Facility — with disbursements of approximately US$700 million tied to each review — is approaching. The program requires Argentina to meet benchmarks on reserve accumulation, fiscal surplus maintenance, and structural reform progress. With tax revenues declining in real terms for seven consecutive months and the primary surplus target of 1.5% of GDP under pressure, any wobble in compliance could unsettle bond markets and weigh further on equities. The US$19 billion+ in debt maturities due in 2026 makes refinancing conditions critical.

07 Global Context

Monday’s decline was part of a broader Latin American risk-off move, with the COLCAP (−0.85%) and IPC (−0.66%) also falling. The Hormuz crisis — now in its fifth week — continues to push oil higher, which benefits Vaca Muerta but amplifies global risk aversion. The Trump–Milei alliance provides institutional credibility via the US$20 billion currency swap and IMF backstop, but the relationship is implicitly conditional on Milei’s continued domestic political strength. The peso’s gradual depreciation within the inflation-linked crawling band adds to the effective cost of holding Argentine equities in USD terms — a factor that weighs on international allocators despite the bullish ARS return.

08 Looking Ahead

The Merval is caught in a tug-of-war between the positive MACD divergence (histogram turning bullish) and the persistent failure at 3 million (four rejected breakouts). If the MACD momentum builds and the 50-day MA at 2,907,000 holds as support, the setup for a fifth — and potentially successful — attempt at 3 million improves. A break below 2,907,000 would target the broader MA cluster at 2,862,000–2,888,000.

Key catalysts this week: Q4 earnings reports (the proof point for the 19.8x valuation); the next monthly inflation print (a drop below 2.5% would be bullish); the privatization timeline (any announcement on freight rail or water utility); and the IMF review preparation. The market needs one of these catalysts to resolve positively to break the 3-million deadlock. Without it, the Merval will continue its frustrating oscillation around the round number — profitable for range traders, punishing for breakout chasers.

This report was published by The Rio Times. For daily coverage of Latin American markets, read our Latin American Pulse and Brazil Morning Call.

Key Facts

— Deep Dive

— For the complete picture, read our in-depth guide: Latin America Stock Markets 2026: Ibovespa, Merval, COLCAP, IPSA and IPC Guide

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