20171121-法国巴黎银行-Chile__Presidential_election_–_all_eyes_on_second_round_6页_358kb

Chile: Presidential Election Summary

Core Content

The first round of Chile's presidential election resulted in former President Sebastián Piñera winning with 36.6% of the vote, securing his place in the second round. His lead over the runner-up, Alejandro Guillier (22.7%), was 13.9%, which, although a victory, was narrower than expected by polls, making the second round uncertain.

Main Points

• First Round Result:

  • Sebastián Piñera (Chile Vamos) received 36.6% of the votes.
  • Alejandro Guillier (Nueva Mayoria) came in second with 22.7%.
  • Beatrix Sánchez (Chile Vamos) obtained 20.3%, making her the third-place finisher.
  • Total participation was 47%, in line with analyst expectations.

• Need for Second Round:

  • Piñera did not reach the 50% threshold, necessitating a second round on 17 December.
  • Analysts had anticipated a 40-45% vote share for Piñera in the second round, which would make a second-round defeat unlikely.

• Vote Distribution and Uncertainty:

  • The second-round outcome will depend on the voting behavior of the remaining candidates, particularly Carolina Goic (5.9%) and Marco Enriquez-Ominami (5.7%).
  • Piñera has the support of Jose Antonio Kast, a centre-right candidate, who has openly endorsed him, potentially boosting his second-round chances.
  • Guillier may benefit from Beatrix Sánchez’s votes, which could increase his share to 43%.

• Performance in Legislative Elections:

  • Chile Vamos performed better in the legislative elections, securing 37.7% of senator votes and 38.7% of legislative votes.
  • However, the coalition is expected to lack a majority in Congress.

Key Information

• Market Expectations:

  • Markets had priced in a Piñera victory prior to the election.
  • The result may undermine confidence and negatively impact financial markets, as the narrow lead suggests a more contested second round.

• Economic Context:

  • Recent business confidence has improved, but this election result could reverse that trend.
  • A Chart 1 shows consumer and business sentiment levels, while Chart 2 highlights monthly real GDP growth, indicating economic conditions prior to the election.

• Legal Disclaimer:

  • The document is a marketing communication and not investment research.
  • It is non-independent research and may be subject to conflicts of interest.
  • The content is intended for professional clients and relevant persons as defined by financial regulations in various jurisdictions.

Conclusion

The Chilean presidential election has entered its second round due to Piñera's narrow lead. While his victory in the first round was anticipated, the uncertainty surrounding the second round remains high. The support from Kast and the potential shift of votes from Sánchez and others could influence the final outcome. The market reaction may be adverse, given the unexpected result and the potential for a close race. Additionally, the legislative performance of Chile Vamos suggests a stronger political position, but not a majority in Congress.