The Colombian peso weakened to COP1,933.40 against the dollar Wednesday, from COP1,929.95 on Tuesday, after its sharp appreciation last week left it looking overvalued against its main rivals.
“If you look at the Colombian peso, the Brazilian real and the Chilean peso since January 1, you see that the Colombian peso is expensive relative to other currencies,” said Daniel Lozano, an analyst with local brokerage Profesionales de Bolsa.
The peso’s depreciation on Tuesday and Wednesday “is a correction of the strong run up last week. There are no fundamentals behind the fall,” Lozano added.
The benchmark IGBC stock index rose 0.1% to 11,538.43 points, while the Colcap index, which includes the largest companies by market capitalization, also gained 0.1% to 1,366.11 points.
Shares in Toronto-listed oil firm Pacific Rubiales gained 1.1% to COP30,100 on strong appetite for the stock from Colombian investors seeking increased exposure to the oil sector when crude prices are rising, analysts said. The stock was the third-most traded.
Jorge Zuniga, an analyst with local brokerage Asesores en Valores, said that Pacific Rubiales is now trading at volumes that mean it is very likely to be included in the IGBC stock index next quarter.
“I think that by volume Rubiales is going to enter the index, and it’s going to be among the most traded, on a level with Grupo Suramerciana de Inversiones SA and Isagen,” Zuniga said.
In December, Pacific Rubiales became the first foreign company to be traded on Colombia’s stock exchange.
In the debt markets, the yield on the benchmark peso-denominated government bond maturing in 2020 rose to 8.972%, from 8.95% on Tuesday. (Matthew Bristow / Dow Jones)