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Chileans overwhelmingly voted against a proposed new constitution on Sunday that would have marked a sharp shift to the left away from its market friendly laws, which should prove positive for the country's assets, J.P. Morgan analysts said.
The much larger than expected 62% "no" vote combined with 85% participation severely weakens the six-month-old presidency of Gabriel Boric, which had wanted the new charter to help reform the tax, pension and labor systems, boost social services and reduce inequality.
Chile is the world's biggest copper producer, and the industry will win some relief given the proposed charter would have toughened environmental and community rules; it is home to top copper miners such as Codelco, BHP (NYSE:BHP), Anglo American (OTCQX:AAUKF) (OTCQX:NGLOY), Glencore (OTCPK:GLCNF) (OTCPK:GLNCY) and Antofagasta (OTC:ANFGF).
The vote also lifts an overhang for Chile's large lithium industry; potentially relevant tickers include (NYSE:SQM), (ALB), (LTHM), (LAC), (PLL)
Chile's environmental regulator recently approved SQM's compliance plan providing for the gradual reduction of the company's water and brine extraction in the Atacama salt flats.