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S&P 500 Closes 7th Week of Losses; Gilinski Takeover Bid Boosts COLCAP

Oil prices close the week higher despite latent fears of an imminent recession

A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S.Photographer: Michael Nagle/Bloomberg
May 20, 2022 | 06:26 pm

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

🗽 On Wall Street:

U.S. stock markets rebounded in the last hours of trading on Friday, following a massive sell-off that pushed the S&P 500 into bearish territory.

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At the end of the day the trend reversed, preventing the index from retreating more than 20% from the high it reached in January. Nevertheless, it closed its seventh consecutive week of losses, marking its worst streak since 2001, when the dotcom bubble burst.

The S&P 500 rose slightly, by 0.01%, while the Dow Jones Industrials gained 0.03% and the Nasdaq Composite (CCMPDL) failed to reverse losses and slipped 0.30%.

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This was the S&P 500′s fourth post-World War II streak of seven or more weekly losses, according to Bespoke Investment Group.

“Persistent inflation, another Fed policy misstep and recession fears have unnerved investors,” considered Edward Moya, an analyst at Oanda.

🔑 The Day’s Key Events:

Rumblings of a possible recession have yet to scare oil prices, which posted weekly gains amid a tight market and strong demand.

The WTI benchmark chalked up its fourth weekly gain, the first such a streak since mid-February.

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The market is watching for a final decision by the European Union on Russian oil that would include exemptions for countries that are more dependent on supply from Moscow.

It is also waiting to see whether China, the world’s largest crude importer, will lift mobility restrictions in Shanghai, which would help boost demand.

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🥇 The Leader:

The Colombian stock market managed to detach itself from the losses in the United States, and was boosted by a new takeover bid launched by the Gilinski family for Grupo Argos (GRUPOARG).

This is the seventh takeover bid launched by bankers for a company of Grupo Empresarial Antioqueño (GEA), a conglomerate of companies based in northwest Colombia that has operated with a shareholder rotation for decades.

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Gilinski’s move came Thursday night after the family’s third takeover bid for Grupo Nutresa (NUTRESA) was declared null and void this week after failing to reach the minimum the family was seeking, but which now wants to take up to 32% of Grupo Argos, offering $4.08 per share.

The offer boosted the shares linked to the GEA group.

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Brazil’s Ibovespa (IBOV) also pulled clear of the losses in the U.S., thanks to the performance of the healthcare, materials and energy sectors.Shares of Vale (VALE3), Petrobras (PETR4; PETR3) and Banco do Brasil (BBAS3) also boosted the index’s rise.

Mexico’s S&P BMV/IPC (MEXBOL) rose 0.45%.

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📉 A Bad Day:

Argentina’s Merval saw its second consecutive fall after returning to trading on Thursday following a holiday break on Wednesday, and closed Friday with the worst performance in the region.

The fall of Banco Bbva Argentina (BBAR), Transportadora de Gas del Sur (TGSU2) and Cresud (CRES) shares impacted the index, as the Merval has also been adjusting to the events in the U.S. market, according to an analysis by Rava Bursátil.

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Argentina’s economy contracted in March and, despite the recovery of the previous month, with a month-on-month drop of 0.7%, according to the country’s statistics bureau INDEC’s monthly economic activity index.

However, in a year-on-year comparison, the economy grew 4.8% in March.

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🍝 For the Dinner Table Debate:

Elon Musk, the billionaire founder of Tesla (TSLA) and SpaceX, was in Brazil Friday to meet with President Jair Bolsonaro and local business leaders in São Paulo.

Musk was invited by the Brazilian government to discuss investments in the country, the implementation of new technologies to monitor Amazon rainforest deforestation, and with a plan to bring broadband internet to the country’s more emote regions, with the Starlink satellite company planning to connect 19,000 rural schools in Brazil.

“Among other topics, we discussed connectivity, investments, innovation and the use of technology as a reinforcement in the protection of our Amazon and the realization of Brazil’s economic potential,” Bolsonaro wrote on his Twitter account.