(Bloomberg) — Argentina’s investors are keenly watching for leading candidate Alberto Fernandez’s next steps after the results of Sunday’s presidential election were tighter than expected.

Fernandez won the race for the country’s top job, with 48% of the vote, above the 45-point threshold needed to win outright. But with 91% of votes counted, the big surprise of the night was that incumbent President Mauricio Macri narrowed Fernandez’s margin of victory to seven points from a 16-point gap in an August primary.

Analysts and investors are now watching for two key items as they prepare for the market reaction come Monday morning. First, what the final composition of congress will be, and how that may impact key legislation ahead, including a debt restructuring. Second, they’ll be keeping an eye on what signals Fernandez gives in his acceptance speech Sunday evening.

Read More: Fernandez Leads Vote Count Against Macri: Argentina Updat

“I don’t expect massive volatility — markets will be waiting to see who Fernandez appoints to his cabinet and the economic plan he announces,” said Jimena Blanco, political research director at consulting firm Verisk (NASDAQ:) Maplecroft in Buenos Aires. “If anything, this greater balance could have a positive impact for those looking to acquire Argentine assets.”

Here’s what analysts are saying:

Ezequiel Zambaglione, head of strategy at Buenos Aires-broker Balanz Capital:

  • “We’ll have to look at the numbers and see what the makeup of Congress will look like, especially in the lower house. But the main market driver will still be what Alberto Fernandez comes out and says in his speech”

Alberto Bernal, chief strategist at broker XP Investments:

  • “The difference was tight, so Fernandez will have to be a little bit humble about the victory.”
  • “The Fernandez win was priced in, but this tight of a difference was not priced in.”
  • The results show that “something like 44% of Argentina is voting for economic orthodoxy, and still wants to do the right thing in terms of real adjustments. The populist view was not overwhelming, and I think that most of the market was convinced that it was going to be overwhelming.”

Siobhan Morden, New York-based head of Latin America Fixed Income Strategy at Amherst Pierpont:

  • Fernandez’s speech on Sunday will be hugely important to how markets react on Monday
  • Although Fernandez would not officially take the top job until Dec. 10, “there is no honeymoon,” and he will be expected to offer an economic plan and cabinet appointees quickly
  • “The only solution for Argentina is reform-based fiscal discipline,” she said in an interview. “If this is what voters are saying, it’s that they expect responsible management.”

Jimena Blanco, political research director at consulting firm Verisk Maplecroft:

  • “The implication is that any restructure taken to Congress will be moderated by Macri’s coalition, and also that it will be hard, if not impossible to undo many of the Macri reforms.”
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2019-10-27