over 4 years ago • 2 mins
A change of government is credited with helping the Greek stock market rise 33% in 2019 so far – but concerns about a political shift in Argentina sent its biggest stocks down 31% on Monday.
Things were looking black for Greece last year, with investors doubting the country’s leaders could steer its economy between the Scylla of massive debt and the Charybdis of tax reform 👹 🌀
But hopes for a new business-friendly government, now fulfilled, have pushed up the value of the Athex Compositestock index in 2019. Promises of economic growth-boosting initiatives to come have led to its performance outstripping European stocks’ overall, by Zeus!
7,000 miles away in Argentina, meanwhile, investors aren’t so pleased with the political scene. The president’s shock defeat in primary elections suggests a new government may take power in October: one potentially willing to default on the country’s debt. $16 billion is due to be repaid by Christmas... 😬
The Argentine peso has lost 20% of its value versus the dollar this week, and some of the country’s biggest stocks lost half of their value on Monday, wiping out the market’s 2019 gains.
So those investing their hopes (and cash) in the ability of a new Greek government to revive the country’s fortunes would do well to keep a sense of perspective. While Greece’s recent successful return to bond markets suggests it’s unlikely to miss debt repayments again anytime soon, Greek stocks remain over 80% below their 2007 value – and getting the economy back on track is likely to prove a Herculean task.
Enjoying the Finimize app? We’d love some feedback 😍
Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.