Wall Street Week: After a good quarter in the markets, Argentina and Venezuela are at the center of the IMF meeting

Start the second quarter of 2019 after finishing first with very good results for the financial markets, not only in the United States, but around the world.

What remarkable quarter was China 23%, Argentina 16.8% and oil 27.8%. On the downside, the Argentine peso – 13.4%, gold 0% and cereals: soy and wheat with falls of about 8%. Although the global economy recorded weak growth in December and January and scared the markets, signs of a recovery in activity in late February and March further encouraged investors.

For the beginning of the second quarter, the key will be to keep pace with the growth of the global economy. A very direct relationship has been established between the level of activity in China and the exports of manufactured goods in Germany. This ultimately has a significant impact on the rest of Europe. In recent weeks, industrial production in Germany has been poor, but worse than expected. However, eThe rebound in the level of activity in China suggests that this will soon have a positive effect in Germany.

In the United States, the economic activity figures for the beginning of the second quarter are encouraging and the market is updating them for the moment.

At Winston, we recommend our customers let the profits run, do not sell and wait for more news of the pace of the global economy.

The end of prosecutor Muller's investigation eliminated a possible cloud in the markets. The investigation revealed no evidence of collusion between the presidential campaign and Russian agents. He also did not indicate that it was necessary to pursue someone else. This also helped to remove the uncertainties of investors.

IMPROVED EMPLOYMENT DATA

The employment report for the month of March was 196,000 new jobs, above 175,000 expected.

The unemployment rate remained at 3.8%

Job creation in the private sector was 182,000, more than the expected 170,000

Government jobs total 14,000 places

The average number of hours worked per week remained at 34.5

The average hourly wage only increases by 0.1%. It was estimated at 0.3% for the month

The surprise was the revision of the rare figures of the month of February from 22,000 to 33,000 only. With in the middle of many months, with nearly 200,000 jobs created per month, there is one with only 33,000. Very rare.

Data show continued strength in the country's labor market despite slowing economic growth

SPRING MEETING OF THE INTERNATIONAL MONETARY FUND STARTS

The annual meeting is held April 12-14 in Washington DC. This also coincides with the World Bank meeting.

Argentina and Venezuela will be at the center of our concerns.

In Argentina, it is thought that the country will run out of some promised goals, more than anything because of the country's deep recession, Tax collection will be below expectations.

However, according to our estimates, the Fund will approve the management of President Macri and your team and authorize the following disbursements.

In Venezuela, the situation is more complex. The country is in default with its international creditors. We believe that conversations will haunt any potential restructuring opportunities as a result of a change of government.

The initial conversations revealed a kind of help that is immediately aimed at resolving the humanitarian crisis facing the country as well as that of the refugees. With regard to debt, the experts consulted by Winston speak of a very important adjustment possible.

Taking the example of Iraq, it could bestar is talking about a 89% debt capital reduction and with several years of grace before making the payments. However, it is still too early to model scenarios: on the one hand, the debt is virtually unpaid after the sanctions imposed by the United States. Moreover, no one knows if a change of government will take place and under what circumstances.

As always, we will be telling you live about the Fund's deliberations in our offices in New York and with our special envoys in Washington.

Fabian Onetti is president of Winston Capital Advisors in New York, a firm specializing in international financial advisory services for professional investors, family offices and private banking.
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