Colombia political shift: Trump-backed president-elect's hardline stance

What happened: Abelardo de la Espriella, a Trump-backed right-wing candidate, won Colombia's presidency. He swiftly launched a military offensive against the FARC and gave drug cartels and guerrilla groups a one-month ultimatum to surrender. This follows a wave of right-wing victories in the Americas. Recently, Marxist groups attempted bombings, including a foiled bus-bomb plot ahead of de la Espriella's inauguration.

Market impact: Energy and defense sectors are poised to benefit from de la Espriella's hardline stance. His promise to reverse Petro's policies could boost oil and gas production, benefiting companies like Ecopetrol. Defense spending may increase, benefiting contractors like Indumil. Conversely, left-wing-leaning sectors like renewable energy and social services may face headwinds.

What to watch next: On May 20, de la Espriella's government will present its economic plan, detailing potential policy shifts. In late June, the Colombian government is expected to announce its oil and gas exploration plans. Additionally, watch for any escalations or de-escalations in violence, which could impact market sentiment.