Colombian stock market drops 5.42% with Ecopetrol leading losses of 12.20%

Colombian stock market drops 5.42% with Ecopetrol leading losses of 12.20%

After learning this Sunday that Gustavo Petro is the new elected president of Colombia after obtaining 11.2 million votes equivalent to 50.44% of the total votes, the Colombian Stock Exchange (BVC) opened with a drop of 5, 42% to 1,378.10 points. This behavior is led by Ecopetrol, which fell 11.20% to $2,451.

The list is followed by shares of companies such as Enka de Colombia, with a fall of 9.09%, followed by Corficolombiana preferential, with 8.84%; Electric Interconnexion SA, with 7.88%; preferential Grupo Aval, with 7.11%; Promigas, with 6.82%; preferential Cementos Argos, with 6.16%; Grupo Energía Bogotá, with 5.66%; Preferred Bancolombia, with 5.51% and Celsia, with 5.21%.

Likewise, with the opening of markets on the New York Stock Exchange (NYSE), it was evident that the shares of Colombian companies in the United States fell. More specifically, Ecopetrol lost 10%, Bancolombia 6.67% and Grupo Aval 8.98%. Meanwhile, the Dow Jones rose 1.33% and the S&P 500 0.22%.

In fact, an analysis by Credicorp Capital predicts that after the victory of the said candidate, the TES will increase between 70 and 100 basis points, while the dollar will increase by $100, approaching $4,100, and the Msci Colcap index by the Colombian Stock Exchange (BVC) could be between 7% and 10%. In fact, the dollar opened at $4,088.85 on average, which is an increase of $183.8 from the market representative rate (MRR), which stands at $3,905.05 today. .

“In the following days, behavior will depend on the signals that the new government will give and additional pressure cannot be ruled out. That said, we expect an increase in populist proposals in the future given the political and social context. current, while “The Petro government plan is clearly aimed at increasing the role of the state in the economy and weakening the oil sector. Thus, the fiscal accounts remain our primary concern, which should play a role in the markets,” the document reads.

According to Juan David Ballén, director of analysis and strategy at Casa de Bolsa, “the fall in equities is explained by the results of the elections and not by the behavior of commodities, because today, in the case oil and gold, they show a stable behavior Moreover, analysts agree that it will be decisive for the new president to reveal the names of his ministers in order to guarantee the confidence of investors and markets .

Recently, a study conducted by Corficolombiana analyzed Gustavo Petro’s proposal to suspend the signing of new hydrocarbon exploration contracts, in the context of the global energy transition.

Other private sector oil and gas companies, such as Geopark Ltd., could face a weak environment when U.S. markets reopen Tuesday after the June 19 holiday news, according to Bloomberg.

According to the analysis, for Colombia, this decision would have important consequences not only on investments in exploration, but also on those intended for the development and exploitation of the oil and gas deposits discovered.

This entity predicts that the macroeconomic effects would be drastic and immediate on the exchange rate and the trade balance, as we analyze in this report. In particular, candidate Petro’s proposal is to transform the composition of the Colombian energy matrix, laying the foundations for a gradual de-escalation of hydrocarbon extraction.

“This proposal would weaken oil activity to create a policy centered on unconventional renewable energy. The above would not only discourage new investment in hydrocarbon exploration, but also that in reserve and resource development projects. discoveries, slowing their execution and even jeopardizing its economic viability,” the document states.

Moreover, the researchers explain that the current signs of a country’s energy policy are decisive for present and future investments in the hydrocarbon sector. In this sense, announcing the suspension of new hydrocarbon exploration in Colombia would have immediate effects on investments and the production of hydrocarbons.

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