Financial markets are jubilant after the election of Javier Miley

Financial markets are jubilant after the election of Javier Miley

The Buenos Aires Stock Exchange opened at 20% mark on Tuesday, a day after the public holiday that followed the victory of Javier Miley, an ultra-liberal and anti-system fanatic, in Argentina’s presidential election on Sunday against outgoing Economy Minister Sergio Massa.

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Argentina’s main stock index has not seen such a rise at the open in more than 30 years. Shares of Argentine companies, especially banks, rose again at the start of the day on the New York Stock Exchange, after very strong increases on Monday.

It is the national oil company YPF that recorded the strongest increase in both Buenos Aires and New York +40% on Monday. Javier Miley confirmed that he would privatize it, and said: “Everything that could be in the hands of the private sector will move to the private sector.”

Miley’s promises were viewed positively by the markets

This is enough to satisfy the financial markets, which also look positively at the next president’s promises to reduce public spending with a chainsaw. Argentina is heavily in debt and some fear the country will default.

But the euphoria may not last. If Javier Miley implements radical measures at once, such as a sudden switch to the dollar, or the cancellation of social assistance, this could destabilize the country’s economy and create strong social tensions. However, Javier Miley does not have a majority in Parliament, so he may have difficulty implementing some of the reforms he promised during the election campaign.

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Read alsoArgentina: Five questions about the future presidency of Javier Miley

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