UPDATE 1-Third Point's Loeb takes stakes in Fibra Uno, YPF, Royal DSM
(Adds more comments from letter)
By Sam Forgione
NEW YORK, July 18 (Reuters) - Daniel Loeb, head of hedge fund firm Third Point LLC, said in his quarterly investor letter dated Friday that he expects market volatility to continue and that he is optimistic on Argentina.
Loeb, an activist investor, said Argentina is likely to reach an agreement with its holdout creditors by yearend and that his $14 billion firm has taken a stake in Argentine oil company YPF SA, in addition to stakes in Mexican REIT Fibra Uno and in Dutch life sciences company Royal DSM.
Loeb said an agreement between Argentina and its holdout creditors would "undoubtedly benefit the Argentinian economy".
"We hope to uncover additional investment opportunities in Argentina as it emerges from its long malaise," he said.
Argentina defaulted on roughly $100 billion in sovereign debt in 2002. Most of its creditors subsequently reached a deal for reduced payments, but holdout creditors sued and won a court-ordered judgment of $1.33 billion plus accrued interest.
Loeb cited Japan as his firm's "biggest source of losses" this year but said that he still sees "compelling" opportunities in the country.
"We think recent macro headwinds will become tailwinds again towards yearend but remain vigilant about inaction. A failure of Abenomics would likely mean that it is time to move on," he said in reference to Japanese Prime Minister Shinzo Abe's stimulus policies. Continuación...