Argentinians will head to the polls once again on Sunday, in a second-round of voting that will likely see the pro-business opposition trump the incumbent socialists.
It is less than a month since the first vote, on October 25, produced no outright winner. It is also the first time that an election has gone to a runoff in Argentina.
"We are in uncharted territory in Argentina's political history. This will be the first runoff since the current election system was instituted under the 1994 constitutional reform (the 2003 election would have gone to a runoff between Carlos Menem and Nestor Kirchner, but Menem withdrew) and indeed, the first runoff ever," Stuart Culverhouse, global head of research at Exotix Partners in London, said in a report last week.
Sunday's vote will pit the two leading candidates against one another — that's Daniel Scioli, who is backed by fiery President Cristina Kirchner and pro-business opposition candidate, Mauricio Macri. The Argentinian constitution bars Kirchner from running for a third term.
Macri is seen winning — and Argentina's benchmark stock index, the Merval, has rocketed on the prospect of an end to 14 years of socialist rule. It has risen around 22 percent since the first vote in October and is around 60 percent higher on the year.
Both Macri and Scioli have pledged to resolve Argentina's long-standing dispute with so-called holdout creditors, which has dragged on since a massive default in 2002. This could allow the country to re-access the international capital markets and raise much needed funds.
Macri is seen more likely, however, to scale back the swathes of interventionist measures that cripple the Argentinian economy at the moment. These range from capital controls to subsidizing electricity prices far below the market rate.
"A Macri victory would be positive for markets and investors, with the candidate pledging to end currency controls and bring about currency convergence," Nicholas Watson, senior vice president at Teneo Intelligence, said in a report this week.
Argentina's credit rating from Moody's Investors Service is Caa1, suggesting a substantial risk of the country defaulting again on its debts. Earlier this month, however, the agency upgraded Argentina's rating outlook to "stable" from "negative."
"The outlook change is based on Moody's view that shifts in the political climate are reducing the risk of investors suffering greater than expected losses once a new government assumes power on 10 December 2015," it said.
Mauro Leos, senior credit officer at Moody's, warned that adjustments to Argentina's economic policy would cause short-term pain, however.
"Everybody is really excited about Argentina… but what markets are missing is that the economy has been mismanaged for 15 years… They have to adjust the economy and adjustment means pain," he said at a briefing on Wednesday.