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What: Shares of Peruvian banking giant Credicorp
So what: In an upset, the left-leaning Ollanta Humala defeated Keiko Fujimori for the presidency in Peru. In a post-election speech, Humala pledged to bring more of the spoils of Peru's boom to the masses. Among other things, it's expected that he'll step up taxes on mining companies in the country.
Now what: This is a classic case of the market simply not being prepared, as it seems there was a strong expectation that Fujimori would win the election. Much of the Peru market was selling off today along with Credicorp. Now investors will have to wait to see how drastic Humala's policies will be, and what impact they'll have on Peruvian companies.
According to Reuters, one of Humala's main economic advisors thinks bears will be disappointed, saying, "Investors betting against Peru will lose because incoming president Ollanta Humala will adhere to responsible policies that respect private investment and fiscal equilibrium."
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Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.
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