Argentine stocks whipsaw as Trump ties US aid to Milei's midterm win

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By Niket Nishant and Pranav Kashyap Latin American assets slipped on Tuesday, resuming their fall on renewed jitters over U.S.-China trade tensions, while Argentine stocks suddenly fell after the U.S. president's comments.Buenos Aires stocks BCBA:IMV, which had been on a steady climb, abruptly reversed course - sliding over 2% - after Donald Trump made clear that Washington's financial lifeline to Argentina is contingent on President Javier Milei's party winning this month's midterm elections, bluntly warning, "We're not going to waste our time" if they don't. The stakes for Milei have now dramatically risen. His September defeat in Buenos Aires Province had already triggered a sharp selloff in Argentine assets, and Trump's warning has added fresh urgency to Milei's uphill battle to retain investor confidence. Investors who were tiptoeing back into Argentina, took a pause to digest Trump's message, with U.S.-listings of the country's stocks tanking. "The symbolism may quickly fade into resentment and that's going to be bad for Milei. The stakes are extremely high and he has to deliver over the next few days in order to get the voters next to him to retain investor confidence," said Pantheon Macroeconomics' chief Latin America economist Andres Abadia. The two counterparts met in the White House, where Trump said Milei was "on the verge of economic success" and offering an endorsement ahead of the midterms. Treasury Secretary Scott Bessent echoed the sentiment, saying Milei is poised to "do well" as voters weigh his radical reform agenda amid a $20 billion U.S. bailout.Bonds, however, kept their strength. Argentina's 2029 dollar-denominated bond (040114HX1=1M) was up 2.6 cents at 79.75 cents on the dollar, while bonds maturing between 2030 and 2046 were up 1 cent or more each. Sentiment globally was somber due to the latest flare-up between Washington and Beijing on a dispute over rare earths. Signals from both sides remain mixed as they began imposing additional port fees on ocean shipping firms on Tuesday.MSCI's gauge for Latin American equities (.MILA00000PUS) lost 0.1%, while a parallel index tracking regional currencies (.MILA00000CUS) was down 0.2%. Both indexes were trading close to one-month lows after a surge on Monday. Tuesday's declines highlight how sensitive investors remain to the slightest signs of trade friction, which can dent sentiment in ...

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