What happened

Argentina's stock market suffered mightily last week, as investors worried that voters might oust current President Mauricio Macri in favor of his socialist/Peronist challengers Alberto Fernandez and Cristina Kirchner in the upcoming October elections.

Now, though, there's a new worry to, well, worry about: Argentina may not even make it to October.

Burlap bag labeled with dollar sign balanced on a teeter-totter against blocks labeled risk while a paper umbrella stands in the middle

Image source: Getty Images.

So what

In today's Argentina stock market update, we find financial stocks Grupo Supervielle S.A. (NYSE:SUPV) trading down 7.6% as of 10:35 a.m. EDT, Banco Macro S.A. (NYSE:BMA) off 9.6%, and Grupo Financiero Galicia (NASDAQ:GGAL) down 11.3%.

What's got these three horses of Argentina's financial apocalypse so spooked today?

As Bloomberg reports this morning, Argentine Economy Minister Nicolas Dujovne resigned from his post on Saturday, following credit downgrades from Fitch Ratings and S&P. Granted, both ratings agencies already considered Argentina's sovereign debt "junk," but now they think it's even junkier.  

The result: With added risk come added demands to be compensated for that riskiness, and creditors are demanding "extra yield" to own Argentine debt, raising the cost of that debt -- and pushing Argentina closer to a default.

And since, as a general rule, ratings agencies don't assign companies higher debt ratings than the country in which they're headquartered, what's bad news for Argentina is also bad news for Grupo Supervielle, Banco Macro, and Grupo Financiero Galicia.  

Now what

Meanwhile, investors are bracing for the results of an International Monetary Fund visit to Buenos Aires later this week, at which representatives of the IMF may decide to disburse -- or withhold -- a planned $5 billion loan to the country next month.

Should that loan not be forthcoming, things could get a lot uglier in a hurry, and investors may see Argentina default even before it gets a chance to swear in a nuevo presidente.