One of the most relevant funds in Chile, which brings together a dozen local companies, collapsed this Monday, December 20, more than 7.8 percent in the Santiago premarket.
The Chilean peso also falls in relation to the dollar.
The falls, according to analysts, are related to the first reactions of the markets after the victory of Gabriel boric in the presidential ballot in Chile.
According to the same economists, setbacks are expected in debt securities and in the valuation of the shares of most of the companies with origins in Chile or with heavy investments in the country.
The decline, in addition, is enhanced by a wheel that is seen as bearish worldwide due to the news of the impact of the omicron variant of coronavirus. Indeed, the Asian and European stock markets are in decline, as is the Wall Street premarket.
Boric, new president of Chile
Boric was elected president in Chile after beating right-wing ultra-conservative José Antonio Kast by 10 percentage points, in a day in which there was a historic turnout of more than 55 percent.
Boric comes to power from the hand of an alliance of left and center-left parties, which is why the markets feel they may be threatened.
Gabriel Boric won with 55.8 percent of the vote over Kast’s 44.2 percent, according to the report from the local electoral authority. 8.4 million votes were counted, out of the 15 million Chileans eligible to vote.
As he did during the campaign, in his first speech as president-elect, Boric spoke of advancing in “social transformations” and in the “demands raised in the social explosion” of 2019, especially in relation to pensions, a private system of very unequal retirement that takes years of discussions in that country.
“An economic growth that is based on deep inequality has feet of clay,” said Boric regarding his main government objective: to combat inequality in one of the most unequal countries in Latin America.
The exit from the private pension system is one of the issues that, according to analysts, most worries the markets.
Also education, almost entirely private in Chile, is an issue that Boric intends to address and that is a sensitive point for investors in the current education system.
As is happening in Mexico and other countries in the region, Chile is beginning to recover from the effect of the health crisis, with an economy that is renewing its growth, but with a problem: the “ghost” of inflation.
The Chilean mining industry, the country’s main source of dollar income, congratulated Boric for the victory and asked him to “prevail moderation” and for there to be “dialogue” to sustain this sector that is key for Chile, the top copper producer. globally.
In this sense, Boric, in his speech after the victory, said that he will oppose the development of “Dominga”, an iron and copper mining project in northern Chile that has been the center of discussions for a long time due to its impact on the environment. .
Gabriel Boric, a millennial former student protest leader, won Chile’s presidential runoff following a bruising campaign pitting him against José Antonio Kast, a free-market firebrand likened to Donald Trump. https://t.co/bNqwhekobt
– The Associated Press (@AP) December 19, 2021
Gabriel Boric wins in Chile and what does Vargas Llosa have to do with it
On social media, many users in favor of Boric “thank” Mario Vargas Llosa for the explicit support that the Peruvian writer gave to the rival, Kast, hours before the election.
It is that Vargas Llosa has not had luck in the support he gave to the candidates of all the last elections in Latin America and Spain: all the candidates he promoted lost.
We have to thank Mario Vargas Llosa for supporting Kast. It always adds up.
Congratulations, @gabrielboric ✊🏽🌹🇨🇱
– AntonioMaestre (@AntonioMaestre) December 19, 2021
Another hit by Mario Vargas Llosa.
– Sebastián Lacunza (@sebalacunza) December 19, 2021
Vargas Llosa’s jinx continues: he supported Pablo Casado in Spain, Keiko Fujimori in Peru and José Antonio Kast in Chile.
All have lost.
– Daniel V. Guisado (@DanielYya) December 19, 2021
“Who CHUCHA told Vargas Llosa to support me. That csmr wea po has salted me ” pic.twitter.com/MLPaQDgUTq
– claudio (@quizaspienso) December 19, 2021