The New York-listed shares of Argentinian oil and gas firm YPF SA (NYSE: YPF) jumped by 42% early on Monday after far-right outsider Javier Milei won the presidential election in Argentina in a victory over his left-wing rival, current economy minister Sergio Massa.
Milei won the presidency in a runoff vote on Sunday amid a severe economic crisis in Argentina.
Weeks before the election, Argentina was rocked by an unprecedented shortage of gasoline, with drivers running the gauntlet to find scarce supplies of gas to fill their tanks amid what Reuters has called "the most acute fuel shortage in years", which has left many filling stations out of supply and long lines at any pumps still operating.
Inflation rates in Argentina are exceeding 140% and the economy is in disarray. The country has been in and out of severe economic crises for decades and has defaulted on its international sovereign debt three times since 2001. Currently, poverty is affecting over two-fifths of the population of around 46 million people.
Milei, who describes himself as an “anarcho-capitalist” of the antiestablishment, ran on a platform that included taking a “chainsaw” to public spending and reducing the state sector. Other proposals of the newly elected president include adopting the U.S. dollar in the Argentinian economy and prioritizing trade relations with capitalist nations like the United States over China.
The president-elect has also promised to “burn down” the Argentinian central bank. Milei has also said he would aim to reduce the role of the government in the economy.
In his first speech as president-elect, however, Milei struck a more moderate tone.
Following Milei’s election win, state-controlled oil firm YPF saw the highest gains on the stock markets. Shares in many banks also rallied, as did Argentinian bonds. But the Argentinian currency, the peso, came under pressure, investors told Reuters on Monday.
By Charles Kennedy for Oilprice.com
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