Argentina's Scioli leads election but could face run-off

BUENOS AIRES (Reuters) - Argentina's ruling party candidate Daniel Scioli had a clear lead in Sunday's presidential election, but his main rival's party said it was sure Scioli would fall short of an outright win and have to face a run-off.

In a speech before thousands of party militants, Scioli reached out to swing voters for their support without explicitly accepting the vote would go to a second round.

"United together we will triumph," Scioli told voters in a rallying call. "I call upon the undecided and independent voters to join this cause."

In a rare direct attack on his main challenger, Mauricio Macri, the conservative mayor of Buenos Aires, Scioli said he was convinced Argentines did not want fiscal austerity and that Macri would abandon the country's poor.

The outcome of the election will shape how the South American country tackles its economic woes, including high inflation, a central bank running precariously low on dollars and a sovereign debt default.

Scioli promises he will make only gradual changes to outgoing leader Cristina Fernandez's brand of leftist populism while main pro-business opposition candidate Mauricio Macri talks of swiftly dismantling her protectionist controls to open up the ailing economy.

Marcos Pena, Macri's chief campaign strategist, said their exit poll data showed there would be a second round.

"Now the real election begins," exclaimed Maria Astigarraga, a 45-year-old doctor, inside the music-filled campaign headquarters of Macri's 'Let's Change' alliance. "There's no doubt we're going to a second round!"

The electoral authority said early provisional results might not be known until 11 p.m. (2200 ET).

To win outright in the first round, Scioli needs 45 percent of votes or 40 percent and a 10 percentage point lead over the nearest rival. If he falls short of that, the two leading candidates will face off in a second round next month.

Macri's chances of reversing the result in an eventual second round would likely depend on how far he ends up behind Scioli on Sunday.

If Scioli were to finish near the 40 percent threshold with a 10 point margin, he would be favourite with Macri requiring roughly two thirds of the votes that went to other candidates.

However, if the margin is narrower, Scioli could be vulnerable if the opposition unites behind Scioli.

Alberto Perez, a central figure in Scioli's inner circle, told reporters that unofficial numbers showed the candidate won a "resounding victory" but he did not say if it was big enough to avoid a second round.

Former powerboat champion Scioli draws much of his support from poorer Argentines who credit Fernandez and her late husband and predecessor Nestor Kirchner with an expansive welfare system and lifting the economy out of a devastating 2001-2002 depression.

DIVISIVE LEGACY

Fernandez will step down with approval ratings near 50 percent, yet her eight years in power have been deeply divisive.

Pre-election polls showed that Macri, the conservative mayor of Buenos Aires and former president of the popular Boca Juniors soccer club, has stronger support among the urban middle and upper classes.

Macri is also favoured by investors who are interested in Argentina's vast energy and metal reserves but are deterred by the stifling controls that Fernandez has placed on the economy.

He and centrist Sergio Massa, who was in third place in pre-election polls, both promised to work quickly on dismantling trade and currency controls, and to improve the accuracy of government economic data that experts say is often fudged. They also vowed to tackle rising crime.

"I'm fed up with the insecurity and of the government giving hand-outs to delinquents who don't work," said saleswoman Florencia Corbalen, echoing a common refrain among the middle-class that Fernandez's welfare benefits have been too generous.

All three main candidates have tip-toed around the subject of negotiations with U.S. creditors whose legal battle over unpaid debt tipped Argentina back into default last year. But each team says their candidate wants a deal that does not sell Argentina short.

The electoral authority said voter turnout was 79 percent.

Voters also elected some regional governors, half of the lower house of Congress and a third of the Senate on Sunday.

Macri's camp said it was competing "vote for vote" against the ruling party in Buenos Aires province, home to more than one in three Argentines and where the ruling party had hoped to install a close Fernandez ally.

(Additional reporting by Hugh Bronstein, Maximiliano Rizzi, Juliana Castilla and Maximiliano Rizzi; Writing by Richard Lough; Editing by Kieran Murray and Christian Plumb)