IPSA Nears 11,000 on Copper Surge as Chilean Peso Leads EM Gains

The Big Three

Market Snapshot

Equities & Corporate

The S&P IPSA gained 0.63% to 10,991.76, extending its recovery to a third consecutive session and approaching the psychologically important 11,000 level. SQM-B led the panel with a 3.2% advance, driven by the copper rally, followed by Colbún (+2.7%), Bci (+2.4%), and Enel Chile (+1.8%). Diario Financiero noted that closing auctions have been the decisive mechanism driving this three-day recovery, with foreign capital flows intensifying in the final minutes of trading.

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.

Monday’s session had been a retail-driven affair, with mall operators Mallplaza (+7.3%) and Cenco Malls (+4.5%) leading alongside Cencosud (+3.9%) and Falabella (+2.8%), boosted by falling interest rate expectations. Tuesday shifted the leadership to mining and utilities, reflecting the copper tailwind from China’s return to trading. Vantrust Capital analyst Fernando Santibañez noted that “company fundamentals remain intact” and valuations, while elevated after 2025’s rally, remain attractive in historical perspective.

The IPSA sits 5.5% below its all-time high of 11,627.58 set on January 28. Earnings season is underway, with Enel Chile reporting Friday. The SQM-Tianqi overhang remains: the Chinese firm announced plans to sell up to 1.25% of its stake in the lithium producer, a factor that contributed to SQM’s 5.3% drop earlier in February. Latam Airlines’ record FY2025 profit of US$1,460M (+50%) has yet to fully translate into share price support after multiple secondary offerings weighed on sentiment.

Currency & Monetary Policy

The peso was the best-performing emerging-market currency on Tuesday, appreciating CLP 5.50 to 861.50 per dollar on Bloomberg, its lowest level of the session. The move was almost entirely copper-driven: the Comex copper contract surged 2.3% to US$5.98/lb as Chinese markets reopened after the Lunar New Year holiday, with Shanghai reactivating physical and speculative demand. The peso closed at its 20-day moving average, suggesting the move may find near-term support.

Producer prices delivered a hawkish surprise: the INE reported January PPI at +3.5% month-over-month and 14.2% year-over-year, well above the 12% consensus. Mining PPI jumped 6.8% monthly, driven by copper extraction and processing costs. While producer inflation doesn’t automatically pass through to consumer prices, the magnitude of the miss raises questions about the BCCh’s ability to reach its 3% CPI target, now pushed to Q3 2026.

The BCCh holds its policy rate (TPM) at 4.75% and has signaled a data-dependent approach. Analysts project the dollar to trade near CLP 840 by year-end 2026 if copper stays above US$4.40/lb (per Cochilco’s forecast) and political stability is maintained under the new right-leaning government. Weekly volatility at 3.65% is well below the 10.17% annual average, indicating contained currency risk despite the tariff backdrop.

Technical Analysis — S&P IPSA Daily

Tuesday’s candle was modestly constructive: the IPSA opened at 10,923.25 (exactly Monday’s close), dipped briefly to 10,904.09, then rallied through to close at 10,991.76, near the session high of 11,015.41. The close above 10,970 (a recent congestion level visible on the right-side axis) is a mild positive, and the third consecutive green candle suggests the selling pressure from the early-February correction is easing.

RSI reads 48.01 / 45.80, sitting in neutral territory after pulling back from the overbought 70+ readings seen at the January all-time high. The MACD panel shows the line at 0.591 (barely positive) versus the signal at −49.42, with the histogram at −50.01 in red. While MACD remains bearish overall, the MACD line crossing above zero would signal a potential momentum shift — something to watch in coming sessions.

Price is trading within the Ichimoku cloud, which spans roughly 10,902 to 10,917 (Senkou Span levels), meaning the index is in a transition zone rather than a clear trend. The 200-day SMA at 9,350.12 provides deep structural support 14.9% below the current close, confirming the longer-term uptrend remains well intact. A close above 11,090 (the upper cloud boundary) would tilt the bias back to bullish.

Key Levels

Global Context & Commodities

Wall Street’s “Turnaround Tuesday” provided a supportive backdrop: the S&P 500 gained 0.77% to 6,890.07, the Dow added 370 points (+0.76%), and the Nasdaq rose 1.04%. AMD surged 8.8% on Meta’s multibillion-dollar GPU deal, Home Depot beat earnings, and software stocks rallied after Anthropic’s enterprise event eased AI-disruption fears. For Chile, the AMD-Meta deal was particularly relevant given SQM’s role in the technology supply chain through lithium and the broader EM risk-on signal.

Copper was the story of the day. The Comex future surged 2.3% to US$5.98/lb as Chinese mainland markets reopened after the Lunar New Year holiday, reviving both physical demand and speculative positioning. Inventories at major international warehouses remain elevated, but the market is pricing in post-holiday absorption. Oil held near six-month highs with Brent at $70.89, while gold fell roughly 2% to $5,130/oz on profit-taking. The DXY edged up 0.15% to 97.79.

Trump’s 10% global tariff under Section 122 entered force Tuesday, with the threat of a 15% increase still hanging. Chile’s trade agency Subrei confirmed the tariff applies at the 10% level. Trump’s State of the Union on Tuesday night doubled down on tariffs, condemned the Supreme Court ruling, and claimed tariffs could replace income taxes, but offered no new specifics that altered the existing framework. The 150-day limit without congressional approval caps the duration risk.

Looking Ahead

Nvidia’s Q4 FY2026 earnings after Wednesday’s close are the dominant near-term catalyst. Consensus expects $65.7B in revenue and $1.53 EPS, with Q1 FY2027 guidance near $71B as the key datapoint. For Chile, the read-through is both direct (SQM’s lithium demand tied to AI-driven data center expansion) and indirect (global risk sentiment that has dominated IPSA flows in the closing auctions).

Domestically, Enel Chile reports Q4 earnings on Friday. The continuation of Chinese trading activity post-Lunar New Year (markets remain open through March 3) will be critical for copper and by extension the peso. The BCCh’s next decision is awaited, with the 4.75% TPM likely to hold given the PPI surprise; any hawkish shift would support the peso but weigh on rate-sensitive equities like the retail names that led Monday’s rally.

Verdict

Chile had perhaps the most constructive session of any Latin American market on Tuesday, with the IPSA, peso, and copper all moving in the same direction. The three-day recovery from the early-February correction is gathering momentum, and the 11,000 level is within striking distance. SQM’s 3.2% advance and the peso’s best-in-EM performance signal that the China-copper nexus remains the dominant driver for Chilean assets.

The risks are real but manageable. The PPI surprise (14.2% vs. 12% expected) hints at cost pressures that could slow the BCCh’s eventual easing cycle. The Tianqi-SQM overhang creates episodic selling pressure on the index’s most heavily weighted stock. And the 10% US tariff under Section 122 introduces a new cost layer for Chilean copper exports, though the direct impact is limited given China remains the primary buyer.

Technically, the IPSA is in a transition zone within the Ichimoku cloud. A close above 11,090 would confirm the correction is over and re-target the 11,208 February high. RSI at 48 is neutral, offering room in both directions. The 200 SMA at 9,350 (14.9% below) anchors the structural bull case. For now, copper is king: if the post-Lunar New Year demand revival sustains through March, the IPSA’s path back toward its 11,628 ATH reopens.