Shares of Argentinian companies and relevant indexes have fallen dramatically after last week’s primary election
Mauricio Macri, the current president has been helming a radical austerity drive that has managed to restore some of Argentina’s reputation in the financial markets. His government has also managed to solve the long running dispute with “vulture funds” over Argentina’s sovereign debt default.
All of this has taken great toll on the country’s citizens unfortunately and it seems that they are unwilling to stand it for any longer. Macri and his allies have suffered a crushing defeat in the primary election and according to most observers, there is little chance that things will change enough for Macri to be re-elected in the general election at the end of October. To illustrate the level of panic on the markets right now, on the credit default market, traders are pricing a 75 % chance that Argentina will default again in the next 5 years; this percentage was 49 % on Friday before the primaries.