The Merval Index closed yesterday with a gain of 1.71% for the day, which translates to a monthly gain of 24.46%. As the Argentinian newspaper La Nacion writes, May was the best months in the last three years for the Bolsa Commercial (Argentinian Stock Exchange).
According to La Nacion, the pheonmenon was due to the solid performance of the papers that are related most closely to the oil sector, since the gain in the price of oil more than compensated for the loss in value of the USD, as well as to the performance of certain financials.
Among the companies who profited most was Petrobras, up 3.59% and 36.06% for the day and month respectively, and Tenaris, a company specialized in oil exploration and exploitation, which was up 3.35% for the day, Grupo Finaciero Galicia, up 42.5% for the month and Banco Francés, up 42.5% for the month.
I find that interseting, because it dosen’t seem to indicate a fundamental economic recovery in Argentina either, but ‘a fiddling with the numbers’ by speculators. Financials can be manipulated very easily as we have come to learn, so they are simply not reliable indicators of economic development.
Besides, even if the values assigned to the financial were reliable, they still don’t produce anything of real value, therefor they don’t increase the wealth of anyone, except the chosen few executives.
The oil price is controlled by OPEC which announced a price target of $75 per barril and we know that some speculators have already prepared for reaping the windfall from that rise by buying oil cheaply, filling up storage tanks in ports and leaving the oil on tankers until the prices rise, so they can sell it at a hefty profit (for themselves).
Thus I conclude that the rises in certain stock exchanges are not a sign of recovery, but indicate clearly that the market are not efficient at all, but that they are rigged. In other words, those markets do not deliver any usefull econmic indications at all.