President Pedro Castillo completes his cabinet after causing shockwaves with appointment of controversial Guido Bellido as prime minister

After 24 hours of uncertainty and the worst Friday in years on the stock exchange, Peru’s new president, Pedro Castillo, has completed his cabinet, swearing in the moderate leftist economist Pedro Francke as finance minister, and in the process calming jittery investors and anxious Peruvians alike.

Aníbal Torres was also sworn in, as justice minister, on Friday, filling the remaining empty cabinet posts. The rest were sworn in late on Thursday, amid deep unease over Castillo’s choice of prime minister, Guido Bellido, who is under investigation for allegedly defending the Shining Path, a Maoist rebel group that killed tens of thousands of Peruvians in the 1980s and 1990s, and is also accused of making homophobic remarks.

Appointment of Guido Bellido ends hopes of a moderate government and is likely to spook jittery investors

A day after being sworn in as Peru’s president, Pedro Castillo has appointed a far-left lawmaker and member of his Marxist party, Guido Bellido, as prime minister, ending expectations of a moderate government.

Beginning nearly three hours late, Castillo swore in an incomplete cabinet on Thursday night that included several figures from the far left and only two women. He did not appoint a finance minister, and Pedro Francke, the favourite for the post, was seen leaving the venue minutes before the ceremony began.

Castillo vows to govern ‘for the people and with the people’ but will face deeply divided Congress

A rural school teacher who has never held public office has been sworn in as Peru’s new president pledging to govern “with the people and for the people” in a ceremony steeped in historic symbolism on Peru’s bicentenary of independence from Spain.

Wearing his typical wide-brimmed straw hat, Pedro Castillo promised to make sweeping changes to the country in his inaugural speech, he paid homage to Peru’s indigenous people and teachers and vowed to combat corruption, rein in monopolies and boost public spending on education and health.

Vladimiro Montesinos secretly recorded apparently suggesting bribes be paid to secure election for Keiko Fujimori

He was known as the Peruvian Rasputin, the spymaster of one of the country’s most corrupt and brutal regimes.

Vladimiro Montesinos masterminded a network of political espionage, mining state coffers to control the military top brass, the courts, and the media, until he was brought down by one of his own videotapes, which showed him bribing politicians.

Claims of rightwing candidate, trailing Pedro Castillo in the polls, emboldens far right, who have vowed not to accept result

The prospect of the son of illiterate Andean peasants becoming president as his rival cries fraud has shaken Peru’s entrenched class system and its fragile democracy, letting loose a torrent of racism in the bicentennial year of the country’s independence.

With 100% of the official vote counted, leftist Pedro Castillo had 50.12% – and advantage of about 44,000 votes over his far-right rival Keiko Fujimori. But Fujimori has claimed fraud, challenging about 500,000 votes, calling for half to be annulled, and obliging officials at Peru’s electoral board to reexamine ballots – despite the lack of evidence of wrongdoing.

Pedro Castillo is about 0.2% ahead of his far-right opponent, Keiko Fujimori, with more than 94% of the vote counted

The scion of a jailed autocrat and the son of illiterate peasant farmers are fighting vote by vote for the presidency of Peru, in an election which has thrown into sharp relief the Andean country’s deep fault lines of class and geography.

Related: Peru faces poll dilemma: a leftist firebrand or the dictator’s daughter?

Pedro Castillo challenges Keiko Fujimori, the daughter of the disgraced 1990s autocrat, in Sunday’s runoff election

Peruvians must choose between the son of illiterate peasant farmers who pledges to upend the country’s free-market economy and the unpopular daughter of a 1990s autocrat, who faces jail on corruption allegations, when they vote on Sunday in the most polarised election in living memory.

Amid surging poverty, one of the world’s worst Covid outbreaks, months of political crisis and rampant anti-left scaremongering, Peruvians will choose the fifth president in as many years.

• Two children among dead in remote hamlet
• Leaflets threaten voters for rightwing candidate Keiko Fujimori

At least 14 people, including two children, have been killed by a splinter group of the Shining Path rebel group, in a brutal attack on a remote jungle hamlet, according to Peru’s military.

Leaflets reportedly scattered at the site of Sunday’s massacre warned locals to boycott upcoming presidential elections next month and said anyone who voted for the rightwing candidate Keiko Fujimori would be considered a “traitor”.