Peruvian President-elect Ollanta Humala spent the last two months convincing investors he won't stifle economic growth with an anti-business agenda. He now faces the anger of backers who say he pandered to the markets.

Humala, a one-time ally of Venezuelan President Hugo Chavez, takes office today vowing to reconcile pledges to boost spending on the poor while attracting foreign investment. After stocks and bonds plunged when he was elected June 5, on fears he would increase state control of the economy and raise mining royalties, Humala named a cabinet mostly composed of businessmen and officials from the previous two administrations.

"We're worried," said Mario Huaman, head of the General Workers' Confederation, Peru's largest labor group, which endorsed Humala in the election. "We'll listen very carefully to what he says in the coming days and see if he shares our views. Then we'll decide our plan of action, our plan to fight. He promised change."

Humala, 49, has already seen support taper off in polls. If the decline continues, he may attempt to rally the Andean nation's mostly-indigenous poor who celebrated his victory and abandon the restraint that's surprised investors, according to the Eurasia Group, a New York-based research company.

Eoin Treacy's view There was a great deal of anxiety about the prospect of Ollanta Humala winning the Peruvian election but he has so far plotted a steady course in appointing his administration. The stock market index responded accordingly and bounced back to test the 22,000 area which has been an area of resistance since March. A sustained move above this area would suggest that demand is beginning to return to medium-term dominance.

Elsewhere in Latin America, the Chilean Index pulled back sharply this week on strike action at some of the country's largest copper mines. It has now fallen below the 200-day MA and needs to find support above or in the region of 4200 to question medium-term top formation development. Colombia has posted a progression of lower rally highs since hitting an accelerated peak in November. It needs to sustain a move above 14,500 to break the 8-month downtrend and question potential for further downside.

Brazil's stock market index continues to deteriorate and while somewhat overextended relative to the 200-day MA, a sustained move above 64000 would be required to question scope for additional downside.

Argentina's Merval Index has lost momentum following an impressive advance late last year. It has posted a progression of lower rally highs since the January peak and a sustained move above 3500 would be required to question scope for some additional lower to lateral ranging.