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John Authers

Stocks Aren't Always Right About Latin Populists

Peru’s markets tanked after Pedro Castillo’s presidential victory. History suggests it may prove a buying opportunity.

Is Pedro Castillo the next Lula or the next Chavez?

Is Pedro Castillo the next Lula or the next Chavez?

Photographer: LUKA GONZALES/AFP/Getty Images

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On a day of market torpor, the drama was reserved for the ancient lands of the Incas and the Aztecs. Both Peru and Mexico held elections Sunday. Peru appears narrowly to have chosen the leftist Pedro Castillo as its president, while Mexicans in sweeping mid-term elections clipped the powers of left-wing President Andres Manuel Lopez Obrador (known as Amlo) somewhat, by denying him a super-majority in the lower house of Congress. There was no question how equity investors felt about this. Mexican stocks gained almost 2% on a day of nondescript returns elsewhere; Peruvian stocks tanked by some 8%: