SANTIAGO — Chile said Friday it will hold a referendum to replace the country's dictatorship-era constitution — a key demand of protesters after nearly a month of violent civil unrest.

The announcement sent the stock market soaring over eight percent — the biggest daily rise in a decade — and sparked a recovery by the peso, which was up 3.2 percent.

Lawmakers in Chile's National Congress agreed early Friday to hold the vote in April 2020 after hours of intense negotiations between the governing coalition and opposition parties.

Government spokeswoman Karla Rubilar hailed a "huge agreement" that allowed diverse political forces to talk out their differences and give a "signal of unity."

Thousands took to the streets of Santiago on Friday afternoon, however, crowding into the protest epicenter of Plaza Italia, and violent clashes broke out between small groups of protests and police in the late afternoon.

The charter in force since 1980 and enacted by the former military junta of Augusto Pinochet has been changed numerous times.

But it does not establish the state's responsibility to provide education and healthcare — two demands made by millions of Chileans who have taken to the streets.

"This agreement is a first step, but it is a historic and fundamental first step to start building our new social pact, and in this the citizenry will have a leading role," said Interior Minister Gonzalo Blumel.

The referendum will ask voters whether the constitution should be replaced and if so, how a new charter should be drafted, Senate President Jaime Quintana said.

"It is a political response in the most noble sense of the term, the policy that thinks of Chile, which is taking its destiny in hand and which is assuming its responsibilities," said Quintana, from the center-left opposition.

The Santiago Stock Exchange closed up 8.1 percent on the news, recuperating around half its losses since the beginning of the crisis.

The peso recovered from record losses earlier this week, rising 3.2 percent to trade at 777.29 to the dollar.

"We are happy to have reached an agreement that marks a victory against violence," said Jacqueline van Rysselberghe, head of the Independent Democratic Union party, a pillar of Pinera's coalition.

Not everyone was convinced, though.

"All the attention is on the constitution but there are more pressing things: pensions, education," Raul Opazo, a 39-year-old teacher, told AFP.

The political agreement "solves nothing," said cleaner Leslie, 27. "What about our social demands?" -AFP