Good morning, investors. This weekend, President Trump completed a military action in Venezuela to remove socialist dictator Nicolas Maduro, who has held power for 12 years.

In response, protesters across Seattle, New York, San Francisco and other US cities called for Maduro’s release and questioned the legality of the operation, while locals in Venezuela took to the streets to celebrate the end of a regime defined by widespread poverty, hyperinflation and economic ruin.

Today’s edition unpacks the investment implications for Latin America.

Maduro’s removal could mark a bullish turning point for investors eyeing Latin America.

The iShares Latin America 40 ETF (ILF) gained 45% in 2025, fueled both by domestic currencies strengthening against the US dollar and a right-ward political shift across the Western hemisphere.

Whether President Trump’s move on Venezuela further catalyzes the region or merely secures a windfall for US oil companies will determine if Latin American stocks — as tracked by the ILF — can continue to outperform in 2026

Importantly, Venezuela is not included in the ILF.

The index is dominated by Brazil and Mexico.

Instead, this investment is a bet on the “spillover” effect to neighboring countries, many of which have pivotal 2026 elections that could solidify a market-friendly corridor. 

On balance, there are three scenarios at play for Venezuela. 

This could benefit some US energy stocks, though it would do little to stabilize regional migration or trade and so would barely move the needle for the financial or material companies that comprise most of ILF. 

The status quo would remain largely intact.

In this scenario, the US could lift some sanctions, rejuvenate banking services and open up lines of credit. 

This would be a more pragmatic, less ideological path forward, focused on the plumbing of the economy rather than the politics.

Financials — which account for more than one third of ILF — would be the immediate winners. 

This would expand bullish tailwinds to agriculture and infrastructure, benefitting ILF’s materials (21%) and energy (9%) sectors, as well as two of its largest single-name holdings in Vale and Petrobas.

While the core of this thesis for ILF lies in the regime shift in Venezuela and the potential for a right-wing sweep across the region, the currency markets provide additional support. 

The Brazilian real and Colombian peso posted double-digit gains against the US dollar in 2025. With the Federal Reserve still expected to cut rates multiple times in the coming months, that momentum could continue.

As strong as the ILF performed last year, it’s now emerged as a proxy bet for whether President Trump’s intervention in Venezuela will unlock a regional economic boom.

📊Maduro will appear in Manhattan federal court today. The ousted Venezuelan president will be charged with leading a 25-year narco-terrorism conspiracy. (ABC)

🛢 Investors are bracing for oil to move. Short-term price volatility could hit this week, though much of the swings could be determined by OPEC’s reaction to the news out of Latin America. Uncertainty could push prices higher but eventual stability could bring them down again. (Barron’s)

📈 Wall Street remains bullish on 2026. Valuations aside, corporate profits and falling rates could push the S&P 500 to a fourth-straight year of gains, the longest streak in two decades. (WSJ)

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📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

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