Colombia’s benchmark index climbed Monday, boosted by key oil firms, while the peso gained slightly against the dollar despite concerns that the government could adjust its debt plan for next year.
The IGBC index, the benchmark for the country, rose 0.7% to 15507.31 points. Colombian stocks have climbed 34.71% this year, fueled in large part by shares of Pacific Rubiales Energy, the country’s largest independent oil producer, and state-run oil firm Ecopetrol SA.
The trend continued Monday with Pacific Rubiales climbing 2.12% to COP62,700 while Ecopetrol rose 1.25% to COP4,125.
After surging nearly 120% over the last year, Pacific Rubiales still has plenty of upside, Rupert Stebbings, managing director of Celfin Capital in Colombia, said in a research note. “We believe that there is plenty to come despite the stock being close to our COP62,295 price target,” he said.
Celfin’s pricing model for Ecopetrol doesn’t include the introduction of new technology in the Rubiales oil field, which is set to increase recovery rates, he added.
The Colombia peso, meanwhile, closed at COP1,906.00 from COP1,911.87 on Friday. The currency and bond markets in Colombia are keeping a close eye on the torrential rains throughout the country that could cost the government as much as $5.2 billion.
Some investors are concerned that the government could be forced to adjust its debt plan for next year to finance the rebuilding projects the country will need because of the rain.
The yield on the benchmark, peso-nominated bond 2020 bond, known as TES, stood at 7.693% after opening at 7.708%.