U.S. Markets Rally Amid Powell’s Optimism; Argentina’s Merval Climbs 4%

Oil prices dropped again on Wednesday after Libya called on OPEC and its allies to accelerate supply

Jerome Powell, chairman of the U.S. Federal Reserve, speaks during a live-streamed news conference following a Federal Open Market Committee (FOMC) meeting in New York, U.S., on Wednesday, March 16, 2022. The Federal Reserve raised interest rates by a quarter percentage point and signaled hikes at all six remaining meetings this year, launching a campaign to tackle the fastest inflation in four decades even as risks to economic growth mount. Photographer: Michael Nagle/Bloomberg
March 16, 2022 | 07:00 PM

A roundup of Wednesday’s stock market results from across the region

🗽 On Wall Street:

U.S. stock markets in the United States ended with gains following the positive projections delivered by Federal Reserve Chairman Jerome Powell on Wednesday, on the same day that the U.S. central bank raised its interest rates for the first time since 2018.

The S&P 500 rose 2.24%, while the Nasdaq Composite (CCMPDL) gained 3.77%. The Dow Jones Industrials, meanwhile, advanced 1.55%.

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Powell said “the economy is too strong” to manage tighter monetary policy and that the likelihood of a recession is “not particularly high”.

“The committee is determined to take the steps necessary to restore price stability,” he added at a press conference.

The Fed raised its key rate from 0.25% to 0.50%, after two years of keeping borrowing costs near zero to protect the economy from the pandemic. It also signaled increases to come at the remaining six meetings this year.

🔑 The Day’s Key Developments:

Oil prices dropped again, after Libya urged OPEC and its allies to accelerate supply in the market to alleviate the increase in the cost per barrel.

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In addition, UK Prime Minister Boris Johnson said he is optimistic that Saudi Arabia may increase its production, after meeting with the kingdom’s crown prince, although he assured that he has no guarantees that this will happen.

Adding to the news that drove prices lower was a report from the International Energy Agency in which, while it warned that Russian production could fall by a quarter next month, it also noted that oil demand estimates for this year will be affected by prices.

Weighing on the outlook are the massive lockdowns enforced by China, the world’s largest importer of crude, following a spike in Covid-19 cases as the Omicron variant spreads across the country.

🥇 The Leader:

Latin America’s main stock markets registered gains on Wednesday. The Argentine Merval (MERVAL) index had the best performance, up 4.04%, after two consecutive days of closing with losses following the restrictions announced by the government on soybean exports.

Shares of Sociedad Comercial del Plata (COME), Banco Bbva Argentina (BBAR) and Ternium (TXAR) performed the best on Wednesday.

Argentina’s stock market was not only influenced by the better international mood, between the better projections delivered by Powell and the signs of progress in the negotiations between Russia and Ukraine, but also by the agreements reached in Argentina’s Congress to approve the new International Monetary Fund deal.

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The opposition Juntos por el Cambio (Together for Change) said that on Thursday it will enable the two-thirds majority necessary for the deal to pass to the Senate for debate, handing the government the definitive approval of Congress so that the IMF’s board can discuss the agreement prior to debt maturity on March 22.

Brazil’s Ibovespa (IBOV) rose by 1.98% and the Mexican stock exchange (MEXBOL) gained 0.76%.

🍝 For the Dinner Table Debate:

Are you one of those people who shares their Netflix (NFLX) password with your partner or a relative? It could end up costing you more, as the streaming platform is to launch a pilot program in three markets to charge its users extra.

The modality is being trialed in three Latin American countries: Chile, Costa Rica and Peru, where subscribers with a platinum or standard plan can add up to two other users in different locations. The extra cost will vary according to the country, but, for example, in Costa Rica will be an extra $3 per month.

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Chengyi Long, Netflix’s director for product innovation, said the company has tried to facilitate people living together sharing accounts, with functions such as separate profiles and the ability to see various series of films at the same time.

“Although that has been popular, it has also created some confusion about how and when Netflix can be shared,” Long said. “As a result, accounts are shared among households, which affects our capacity to invest in new TV programs and films for our members.”