The bullish day continues on the stock market after La Libertad Avanza's victory in the Buenos Aires City legislative elections.

Argentine assets are posting strong gains this Monday following the election results that strengthened the La Libertad Avanza party in Buenos Aires . The S&P Merval is up 2.7%, and dollar-denominated bonds are up an average of 1.5%, while ADRs on Wall Street are up as much as 6%.

Just over 24 hours after the ruling party's resounding victory in Buenos Aires, financial markets reacted optimistically. In a session marked by global declines, the Buenos Aires Stock Exchange's leading index bucked the trend and stood at 2,380,000 points, its highest level since February.

ADRs of Argentine companies listed in New York led the rise, gaining up to 6.6%. The largest gains were for Banco Supervielle (+6.6%), Edenor (+5.8%), and Telecom (+5.5%). According to market analysts, the political interpretation of the election results was key to this performance.

"The nationalization of the Buenos Aires elections allowed the national government to demonstrate its strength and gain momentum toward the upcoming challenges in the province and nationally. The presence of the entire cabinet alongside President Milei at the celebration was a clear sign of the consolidation of the libertarian project," Max Capital noted.

Along the same lines, technical analyst Jorge Fedio stated that "the Merval is shaking off the correction of recent months and confirming the bullish bottom that began in October 2022." The index, measured in dollars, has once again surpassed 2,000 points, reflecting market confidence following the elections.

Dollar-denominated government bonds also followed suit. Both the Bonares and Global bonds advanced an average of 1.5%, supported by the consolidation of the economic plan and the favorable outcome for the ruling party. The improvement on the political front reinforces the exchange rate stability that the economic team led by Luis Caputo is seeking to maintain.

Despite local enthusiasm, the international context is showing worrying signs. On Friday night, Moody's downgraded the US debt rating, joining Fitch and S&P, which had previously done so. The decision impacted global markets and fueled the debate about the fiscal sustainability of the world's largest economy.

At the same time, slowing growth in China and domestic political pressures in the United States generated uncertainty. The White House and Beijing confirmed a temporary reduction in tariffs, but fears of a global recession remain.

"Moody's warns that the debt problem is not being addressed. The Republican mega-project only worsens the situation," analyst George Lagarias told Reuters. In the same vein, Felipe Mendoza (ATFX Latam) warned that "Trump is pushing for a rate cut and tax reform that is causing internal divisions."

Contrary to international markets, Argentine assets are showing resilience. Sunday's political decisions realigned expectations, and the Libertarian victory in the City translates into a clear commitment from investors to the continuity of the economic program.

"The market's response is a validation of the reforms promoted by the government. The Buenos Aires result was a sign of support that translates into financial confidence," remarked a foreign investment fund with operations in Latin America.

At this time, Asian markets closed slightly lower, and Wall Street is trading down as much as 0.6%. Even so, the optimism in Argentine assets stands in stark contrast to external caution. For analysts, exchange rate stability, the fiscal surplus, and monetary discipline are key elements that are beginning to be recognized by international investors.