Buenos Aires (AFP)

The peso and purse plunged Monday in Argentina, the day after the outburst of outgoing Liberal President Mauricio Macri in the primary elections considered a general rehearsal of the October presidential election, where he will seek a new term at the head of a country stuck in recession.

At the opening of the markets of the third largest economy in Latin America, the stock market plummeted by more than 10%, before collapsing by 30% at 16:00 GMT.

Friday night, however, the Merval index was up 8%, in an atmosphere of optimism before the election results on Sunday.

For its part, the local currency traded Monday morning at 53 pesos for one dollar, 14% more than Friday at the closing, where the greenback was worth 46.55 pesos. Some bureaux de change even preferred to stop trading dollars.

"A break in political decisions (the next Argentine government) is now the most likely scenario," summarized a note from the bank JP Morgan on Monday to explain the anxiety of the markets.

President Macri met Monday morning with Central Bank President Guido Sandleris, and preferred to shift the cabinet to Monday afternoon to follow market developments.

"The president should be delivering a message of appeasement.The markets warn against the fact that the government is in a situation where it can not provide an answer" to the economic crisis, told Radio 10 the center-left candidate Alberto Fernandez, winner of the Sunday night primaries.

Mr Fernandez and his running mate Cristina Kirchner, the former president of the country indicted in several corruption cases, won 47% of the vote, compared with 32% for the tandem composed of Mauricio Macri and Peronist leader Miguel Angel Pichetto.

"We suffered a bad election and this forces us, from tomorrow, to redouble our efforts.We regret not having had all the support we hoped for," quickly acknowledged Sunday evening the head of state.

- "The contract is broken" -

If such a result is repeated in the presidential election of October 27, Mr. Fernandez, 60, would be proclaimed winner in the first round: according to the electoral law, to be elected, it must obtain at least 45% of the votes, or 40% and an advance of 10 points on the candidate who came second.

It is clear "that the government has lost the support of key sectors of society," said political analyst Carlos Fara.

"For those waiting for a change in Argentina, the symbolic contract is broken," he added. "The vote showed a deep dissatisfaction with the economic situation, an anxiety in society that feels that the government is disconnected from reality and is not up to the problems."

In this country in recession since last year, inflation remains very high over the last 12 months, at 40%, and unemployment, at 10.1%.

Overwhelmed by two currency crises in 2018 that caused its currency to lose 50% of its value, Argentina called the International Monetary Fund (IMF) to the rescue to secure a loan of more than $ 57 billion.

In its latest global growth forecast released in the spring, the IMF had forecast a contraction in Argentina's GDP of 1.2 percent in 2019, while waiting for a recovery in the second half. For 2020, it forecasts growth of 2.2%.

"To hold the markets is the big unknown of the day - if there is no agreement between Fernandez and Macri, it will be very difficult to build trust," said another analyst, Rosendo Fraga.

Created in 2009, the system of general primaries for all political parties, the same day and in a national poll, is an Argentinean peculiarity.

© 2019 AFP