Chile IPSA Falls to 2026 Low at 10,864 as LatAm Rotation Deepens

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The IPSA had touched 11,000 during the morning session before sellers took over, driving the index to close at 10,864.48 — its lowest level since January 5. Trading volumes were weak across the board, as they were globally, with limited institutional interest on either side.

This is part of The Rio Times’ daily coverage of Chilean markets and Latin American financial news.

For context on regional markets, see Brazil’s Ibovespa for the same session.

Also tracking regional peers: Colombia’s COLCAP closed the same session.

Cencosud led the losses at –3.4%, a significant drag given its high weighting in the IPSA. CMPC fell 3.0% and Salfacorp dropped 2.8%, rounding out the session’s worst performers. The broader narrative continues to be one of developed-market rotation: capital flowing back toward the US and Europe at the expense of emerging markets.

Across the region, Argentina’s Merval suffered the steepest decline at –3.1%, while Brazil’s Bovespa fell 0.5% and Mexico’s IPC lost 0.4%. The IPSA remains up 3.7% year-to-date from its 2025 close of 10,481.4 — a year that delivered 72 all-time highs and a 56.2% total return, the best in over three decades.

The Latam Airlines secondary offering overhang continues to weigh on sentiment. The sixth placement by a shareholder in early February totaled US$742 million at CLP 26.4 per share, briefly dragging the IPSA to its worst session since Trump’s “Liberation Day” tariffs. Credicorp Capital maintains a CLP 30.5 target on the stock despite the dilution pressure.

The peso was one of the few emerging-market currencies to strengthen against the dollar on Wednesday. USD/CLP fell CLP 2.9 to close at CLP 863.4, rebounding from intraday lows near CLP 860 as the DXY climbed 0.31% to 97.4. Copper’s 1.9% rally to US$5.75 per pound provided the crucial support, with the metal reclaiming the US$5.8 zone on Comex futures.

The BCCh held the TPM at 4.50% on January 27, following the 25-basis-point cut from 4.75% in December 2025 that brought the rate to its lowest level since January 2022. With January inflation printing at just 2.8% annually — now below the 3% target for the first time in nearly five years — the market is pricing a March cut to 4.25%, which Santander estimates is the neutral rate.

The peso’s roughly 9% annual appreciation reflects a powerful cocktail: copper above US$5.50 per pound, a weakening global dollar, and the pro-business confidence effect from the Kast government. Cochilco’s 2026 copper forecast of US$4.95 per pound average would generate an estimated 1% of GDP in additional fiscal revenue according to Santander, helping narrow the deficit to roughly 1% of GDP.

The IPSA daily chart shows price sitting right at the lower boundary of the Ichimoku cloud, with the close at 10,864 testing the Senkou Span B around 10,750. The cloud has been narrowing since the January ATH, a signal of diminishing trend conviction. A close below 10,750 would constitute a bearish cloud breakdown and open the path toward the 200-day SMA far below.

RSI reads 52.64 on the main oscillator, still in neutral territory but declining steadily from the January overbought zone above 70. The secondary RSI at 41.16 is nearing the oversold threshold, suggesting momentum is approaching exhaustion. The orange Kijun-sen around 10,900 now acts as immediate overhead resistance after being breached this session.

The 200-day SMA at 9,293 (blue line) represents the critical structural floor roughly 14.5% below current levels. Importantly, the IPSA’s secular uptrend from the 2025 lows remains intact as long as this moving average holds. The January rally carried the index 26% above its 200 SMA, a degree of extension that historically invites mean-reversion pullbacks.

The disconnect between developed and emerging markets was on full display. The S&P 500 rose 0.56% to 6,881 as the Nvidia–Meta GPU deal revived AI optimism, the Euro Stoxx 50 hit a new all-time high with a 1.4% gain, and London’s FTSE 100 registered its third consecutive record at +1.2%. Tokyo’s Nikkei added 1%, while Hong Kong and mainland China remained shut for Lunar New Year.

The Fed minutes from the January meeting confirmed a divided committee still focused on inflation, with members noting it would be appropriate to raise rates if inflation persists above target. Markets have pulled back expectations from three cuts to two for 2026. Strong US data — construction permits up 4.3%, industrial production up 0.7%, durable goods core orders beating estimates — gave the dollar further support.

Copper’s rebound to US$5.83 on Comex (+2.2%) was the lifeline for the peso, recovering much of Tuesday’s 2.3% decline. The Cochilco outlook remains constructive: a projected 2026 deficit of 238,000 tonnes in refined copper supports prices well above the US$4.95 per pound average forecast. WTI crude surged 3.83% to US$65.79 on Iran/Strait of Hormuz tensions, while gold pushed to US$5,033, its latest in a series of near-record prints.

The BCCh’s next monetary policy meeting on March 18 is the key date for Chilean markets. With inflation at 2.8% and the TPM at 4.50%, a 25 bps cut to 4.25% — the estimated neutral rate — is the base-case expectation. The March IPoM will provide the updated TPM corridor that could signal whether this is the final cut of the cycle or whether further easing is on the table.

The Kast government’s fiscal and regulatory agenda will continue to shape investor confidence. BICE Inversiones sees scope for a structural re-rating of Chilean equities if capital repatriation materializes, noting valuations remain below the pre-2019 decade average. The Latam Airlines overhang should gradually clear as the secondary offering calendar matures.

Copper remains the swing factor. If prices sustain above US$5.50 per pound through the Lunar New Year reopening, the peso should find further support and the IPSA’s mining components — SQM-B, CAP, and the Codelco-adjacent plays — could lead a rebound. However, with Tianqi’s ongoing liquidation of SQM positions creating intermittent selling pressure, the path back to ATH levels may be bumpy.

Key Facts

— Deep Dive

— For the complete picture, read our in-depth guide: Latin America Stock Markets 2026: Ibovespa, Merval, COLCAP, IPSA and IPC Guide

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