Colombia’s COLCAP Tests Ichimoku Cloud Support After 7.6% Drop From ATH

Tuesday’s session brought fragile stabilization to the MSCI COLCAP after what had been its worst week in 2026. The index closed at 2,366.46, eking out a 0.17% gain (+4.01 points) on thin conviction.

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

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

Also tracking regional peers: Chile’s IPSA closed the same session.

The modest rebound did little to erase last week’s 2.74% decline, which dragged the index 7.6% below its January 27 all-time high of 2,562.00.

Trading was characterized by narrow ranges — the session high of 2,373.15 and low of 2,354.04 indicate a tight 19-point band, suggesting neither buyers nor sellers were willing to commit aggressively.

Ecopetrol, the index’s heavyweight, entered the session under particular pressure after closing Monday at COP 2,170 (down 2.91%). The state oil company faces a complex web of headwinds.

President Petro warned on February 10 that Ecopetrol would “break” if Brent falls below US$60. The USO union rebutted, placing breakeven at US$50. Reserves continue to decline due to exploration restrictions, and the Q4 2025 earnings report on March 3 looms large.

On the operational front, Ecopetrol contracted COP 23.8 trillion in goods and services in 2025, with 96% going to national suppliers. The company’s new Junta Directiva now includes its first-ever worker representative.

In a report published Tuesday, Ashmore analyst Sebastián Gallego acknowledged the COLCAP’s extraordinary run — 19.9% return in January alone in local currency terms, 22.5% in dollar terms — but warned of “possible short-term corrections and/or higher volatility.”

The investment thesis for 2026 remains “moderately positive but with more binary scenarios,” driven primarily by Colombia’s presidential election in the first half of the year.

The equity risk premium for the COLCAP stands at negative 2.6%, meaning stocks are not compensating for the additional risk versus fixed income at the 10-year bond rate of 12.39%.

Despite the correction, the COLCAP remains the third-best performing index globally in 2026, rising 20.6% YTD. Peru leads at 25.6%, followed by Brazil at 21.6%.

Within the Colombian basket, the year’s top performers include Cibest (Bancolombia) at +23.27%, Éxito at +21.27%, Grupo Sura preferred at +21.11%, and Ecopetrol at +19.52%. At the bottom, GEB (+1.01%), Corficolombiana (+0.88%), and Celsia (+0.20%) have barely budged.

Notable corporate developments include Grupo Energía Bogotá’s potential 9.4% stake sale by the Bogotá district government, worth approximately COP 2.6 trillion.

The peso traded with a slight weakening bias on Tuesday. The dollar SPOT market opened at COP 3,649 before closing at COP 3,681 — a 32-peso intraday gain that pushed the closing rate well above the official TRM of COP 3,664.26.

The session saw a maximum of COP 3,690 and a minimum of COP 3,647, with the volume-weighted average settling at COP 3,669.47. The TRM for February 19 was consequently set at COP 3,669.21, a modest 0.14% increase.

Despite the daily softening, the peso’s structural strength in 2026 remains impressive. The currency has appreciated 2.5% from its 2025 close of COP 3,757.08, and stands 10.6% stronger year-over-year.

Bancolombia’s Grupo Cibest projects a 2026 average of COP 3,878, citing global dollar weakness (the DXY fell 9% in 2025), sustained remittance inflows, and favorable coffee prices.

The carry trade remains potent: BanRep’s 10.25% policy rate versus the Fed’s 3.50–3.75% range offers a 650+ basis point differential.

The January 30 rate hike — 100 basis points to 10.25%, the largest single move since December 2022 — remains the dominant monetary policy story. Only BBVA had correctly predicted the magnitude, which caught the vast majority of analysts expecting 50 basis points.

The decision reflected alarm over inflation expectations jumping from 4.6% to 6.4% for 2026, driven primarily by the 23.7% minimum wage increase. BanRep now projects inflation at 6.3% for 2026 (up from 5.1% at end-2025) before declining to 3.7% by end-2027.

The minutes revealed a 4–2–1 split: four directors voted for the hike, two preferred a 50 bps cut, and one wanted rates unchanged. Finance Minister Germán Ávila publicly opposed the decision, while Governor Leonardo Villar defended it as “difficult but necessary.”

The daily chart reveals a correction phase within a broader structural uptrend. The COLCAP closed at 2,366.46, sitting comfortably above the 200-day simple moving average at 1,920.91 — which remains 18.8% below current levels and has not been tested since the rally accelerated in late 2024.

Price is now trading within the Ichimoku cloud boundary near 2,303–2,366, a zone that will determine whether the pullback is a healthy retracement or the beginning of a deeper correction.

The RSI reads 56.28 on the main oscillator and 52.03 on the secondary, both in neutral territory — a significant cooling from the overbought readings above 77 seen at the January highs.

The MACD histogram has turned negative at -17.76, with the signal line at 21.29 and the MACD line at 39.06, confirming bearish momentum divergence. However, the histogram contraction visible in recent bars suggests the selling pressure may be dissipating.

Wall Street recovered Tuesday with the S&P 500 climbing 0.56% to 6,881.31, the Nasdaq gaining 0.78% to 22,753.63, and the Dow adding 0.26% to 49,662.66. The rebound was led by Nvidia, Amazon, and other tech heavyweights after weeks of AI-related selling pressure.

However, the S&P 500 remains below its 100-day moving average for the third time this month, and the Magnificent Seven are collectively down 7% in 2026, with Microsoft and Amazon each off over 10%. Bank of America strategists identified the 6,720 level as the key technical threshold that would clarify whether the market is in healthy rotation or beginning a broader downturn.

Crude oil dominated commodity headlines. WTI surged 3.83% to US$64.72 and Brent jumped 3.53% to US$69.80 after the US warned all American-flagged ships to avoid Iranian waters through the Strait of Hormuz, while Ukraine–Russia peace talks in Geneva ended without progress.

The geopolitical risk premium offset bearish fundamentals: US crude inventories rose 13.4 million barrels last week (the largest build since November 2023), and the IEA continues to warn of surplus conditions.

For Colombia, the Brent recovery above US$69 provides temporary fiscal relief but remains well below the levels needed to sustain Ecopetrol’s dividend transfers to the government. Coffee C futures eased 0.70% to US$297.55, pulling back from the rally that lifted the commodity in recent months.

Gold spot traded at US$4,957 (+1.62%), rebounding after a sharp selloff the previous day that saw prices drop over 2% to ~US$4,865. The precious metal had hit an all-time high of US$5,595 on January 29 before entering a volatile consolidation phase in the US$4,900–5,100 range.

The DXY slipped 0.08% to 96.76, remaining near multi-year lows. The dollar’s continued weakness underpins the structural case for emerging-market currencies, including the peso.

Fed minutes released Wednesday showed policymakers remain divided on the trajectory of rate cuts, with the market now questioning whether three cuts in 2026 remain feasible given sticky inflation data.

Key catalysts this week include US GDP data (Thursday) and the PCE inflation report (Friday), both of which will influence Fed rate expectations and, by extension, emerging-market flows.

Domestically, Ecopetrol’s Q4 2025 earnings on March 3 loom as the next major event for the COLCAP, with analysts expecting continued margin pressure from lower oil prices and higher costs.

The Colombian presidential election cycle intensifies in the coming weeks, with Ashmore noting that “it is still too early to conclude on the presidential election” but that the outcome will dictate 2026 returns. The potential GEB stake sale by Bogotá could provide a test of institutional investor appetite for Colombian equities at current valuations.

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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