Chile Market Report: IPSA Drops 2% as Latam, Entel Drag Santiago

Tuesday was a brutal session for the Bolsa de Santiago. The IPSA sank 2.14% to 11,009.28 — its steepest single-day decline since April 7, 2025, when Trump’s “Liberation Day” reciprocal tariffs rattled markets globally. The index now sits at its lowest close since January 9, having surrendered the entire rally built during the second half of January.

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.

Two corporate events collided to produce the selloff. Latam Airlines fell 4.7% after its sixth secondary ADR sale was priced at US$61.90 per ADR — a 4.5% discount to Friday’s close.

Sixth Street Partners offloaded 12 million ADRs (approximately US$742.8 million) through J.P. Morgan, the single largest block sale in the company’s post-Chapter 11 history.

With Latam commanding high weight in the IPSA and accounting for nearly 40% of Tuesday’s total equity turnover at CLP$115.3 billion, the mechanical downward pressure was enormous.

Meanwhile, Entel collapsed 12.6% to CLP$4,000 — its worst day since the pandemic crash of March 2020. The trigger was Telefónica’s confirmation that it had sold its entire Chilean business to Millicom (49%) and Xavier Niel’s NJJ Holding (51%) for US$1.215 billion.

The market had been pricing in some probability that Entel or América Móvil (Claro) would acquire Telefónica Chile, consolidating the market from four operators to three. That thesis is now dead, and Entel faces a newly capitalized competitor with deep pockets and a stated commitment to invest in Chilean networks.

The broader LatAm context was also negative: Peru’s Select index fell even harder than the IPSA, while Brazil and Mexico posted moderate losses. In the U.S., the Nasdaq dipped 0.3% and the S&P 500 slipped 0.1%, though the Dow managed a 0.1% gain. Demand for safe-haven bonds pushed U.S. Treasury yields lower, with the 10-year down 5.3 basis points.

S&P IPSA — Daily chart. Source: TradingView

S&P IPSA — 4-hour chart. Source: TradingView

On the daily chart, the IPSA has broken below its 20-day moving average (11,207) and is testing the 50-day SMA at 10,968. The MACD has turned negative, with the histogram printing its deepest red bar since last April. The RSI at 44.18 is approaching neutral-to-oversold territory but still has room to fall.

On the 4-hour chart, the picture is more acutely bearish: the RSI has cratered to 34.11, the MACD shows strong downward momentum at −53.75/−61.54, and price is trading well below all key moving averages. The 10,040 level — where the 200-period 4H SMA sits — looms as the next structural support if sellers remain in control.

The peso barely flinched despite the equity carnage. USD/CLP closed at 856.57, up just 0.61% on the day — a marginal weakening that looks insignificant against the IPSA’s 2.14% collapse. The pair opened at 854.04, touched an intraday high of 859.33, and found support at 852.98, suggesting that fundamental peso demand remains intact.

The structural backdrop continues to favor the peso. Copper at $5.90/lb — while off its January record of $13,300/tonne — remains in historically elevated territory, supported by energy-transition demand, AI-driven data center expansion, and constrained mine supply.

Codelco’s El Teniente mine will operate at reduced capacity for the next five years following last year’s accident, underscoring the supply-side constraints that keep Chile’s terms of trade favorable.

The DXY’s slide to four-year lows near 96.8 provides additional tailwinds, as global central banks continue de-dollarization and BRICS nations accelerate local-currency settlement.

USD/CLP — Daily chart. Source: TradingView

USD/CLP — 4-hour chart. Source: TradingView

The daily chart tells a clear story of a pair in a sustained downtrend. Price continues to trade below all major moving averages, with the RSI at 37.77/33.42 — deeply oversold but not yet showing divergence. The MACD is firmly negative at −11.20/−11.46, confirming the bearish momentum.

On the 4-hour timeframe, the pair is consolidating around 856 after bouncing from the late-January lows near 847. The 4H RSI at 43.87/42.83 is neutral, and the MACD is near the zero line at −0.02/−3.32, suggesting the pair may be basing for its next move.

A break below 847 would open the door to the 840 psychological level; a bounce above 870 (the 20-day SMA) would signal the start of a more meaningful correction.

Latam settlement day (Feb 11): Payment for the US$742.8 million block sale settles Wednesday, which may generate residual selling pressure as arbitrage positions unwind.

U.S. CPI (this week): January inflation data could reshape Fed rate-cut expectations and move the dollar. A hot print would be peso-negative; a soft print would reinforce the DXY’s downtrend and support Chilean assets.

Copper tariff watch: The U.S. Commerce Department’s recommendation on refined copper tariffs (expected by mid-2026) remains a key swing factor. Goldman Sachs’s base case is a 15% tariff, which would trigger further U.S. stockpiling and keep LME prices elevated — a net positive for Chile’s terms of trade.

Nikkei record: Japan’s Nikkei surged 2.3% to a new all-time high on Tuesday, a reminder that the global risk-on rotation hasn’t ended — even if Chile had a bad day.

Tuesday’s selloff was violent but largely idiosyncratic. The Latam block sale and the Telefónica–Entel saga are one-off events, not reflections of deteriorating fundamentals. The IPSA’s structural bull case — cheap valuations, copper supercycle, pension reform inflows, and a pro-business government — remains intact.

The 10,968 level (50-day SMA) is the near-term line in the sand. Hold it, and this is a washout to buy; break it, and the correction extends to the 10,762 lower Bollinger Band. The real tell will be whether foreign flows resume once Latam’s settlement clears Wednesday.

For the peso, the equity selloff barely registered. Copper and the weak dollar continue to set the tone, and until one of those pillars cracks, the path of least resistance for USD/CLP remains lower.