Argentina Apoplexy, IPOs and Other Things to Watch on 13F Day

(Bloomberg) -- As hedge fund holdings data pour in, investors will be keeping an eye on which managers may be exposed to the market apoplexy unfolding in Argentina.

Managers including Autonomy Capital’s Robert Gibbins and Pointstate Capital’s Zach Schreiber started the year with bets on Argentine companies that trade in the U.S. After hedge funds finish reporting their end-of-June U.S. equity holdings Wednesday, investors will have an idea whether managers were adding to, or shedding, their positions in the nation during the months prior to the presidential primary elections held Sunday.

President Mauricio Macri’s stunningly poor showing sent Argentina’s stocks, bonds and currency into a tailspin Monday as investors grappled with the idea that the market-friendly candidate will probably lose his re-election bid in October. They’re worried that opposition candidate Alberto Fernandez and his running mate, former president Cristina Fernandez de Kirchner, will bring back the protectionist policies that marked her administration.

In an interview with Bloomberg in April, Gibbins, who manages about $5.5 billion, said he expected voters to ultimately elect a market-friendly candidate in October, even if it isn’t Macri.

“Faced with the choice between going back to what they know to have failed, which was Cristina Kirchner, in kind of a profound de-institutionalization, I think that Argentines are going to choose to carry forward with the path -- whether it’s with Mauricio Macri, or with somebody else” from his party, Gibbins said.

As of the end of March, Gibbins’s biggest publicly traded U.S. equity positions were in Argentine stocks, including mall operator IRSA Inversiones y Representaciones SA and banks Grupo Financiero Galicia SA and Banco Macro SA.

Emerging markets, in general, have sold off as the rout in Argentina and escalating protests in Hong Kong spook investors already on edge over the trade war. As 13F filings come in, investors will also look to see who was exposed to the developing world, as well as these other themes:

• The so-called FAANG group of major technology and internet stocks. Google parent Alphabet Inc. suffered a big one-day drop in late April on the back of a disappointing earnings report, while Netflix Inc. in July reported disappointing subscriber numbers that sent shares falling.
• The underwhelming IPOs of the second quarter, including Uber Technologies Inc., and the eye-popping ones, like Beyond Meat Inc., Chewy Inc., Crowdstrike Holdings Inc. and Revolve Group Inc.
• Mergers and acquisitions, particularly AbbVie Inc.’s mega-deal to buy Botox maker Allergan Plc for $63 billion.

Money managers who oversee more than $100 million in equities in the U.S. must file a Form 13F within 45 days of each quarter’s end to list those stocks as well as options and convertible bonds. The filings don’t show non-U.S. securities, holdings that aren’t publicly traded, or cash.

To contact the reporters on this story: Katia Porzecanski in New York at kporzecansk1@bloomberg.net;Nishant Kumar in London at nkumar173@bloomberg.net

To contact the editors responsible for this story: Alan Mirabella at amirabella@bloomberg.net, Josh Friedman, Dan Reichl

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