Chile peso hits three-week high on global bourses

SANTIAGO, Oct 19 (Reuters) - The Chilean peso hit three-week highs against the U.S. dollar on Monday, rising on the back of higher copper prices and gains in global bourses.

The benchmark IPSA index .IPSA closed 0.28 percent higher at 3,456.39 on Monday due to selective buying before company earnings results and growing optimism that the Chilean economy is emerging from the worst of the global crisis.

The all-market .IGPA rose 0.18 percent to 16,223.24.

Chilean stocks have seen a steep recovery so far this year as investors expect the world's top copper producer to quickly weather the worldwide financial storm.

"The market view is that the worst of the crisis is likely behind us in the upcoming earning results as well as for the macroeconomic figures," said William Baeza, an analyst with Euroamerica Corredores brokerage. "That is probably behind the reversal in short-selling of shares of Falabella and Soquimich."

Soquimich SQM_pb.SN, the world's biggest producer of iodine and lithium, rose 2.16 percent to 21,401 pesos.

Chilean retailer Falabella FAL.SN rose 1.71 percent to 2,665.70 pesos.

The Chilean economy has slowed the pace of its contraction in the last two months and its trade surplus is widening rapidly after being hit hard by the crisis.

Gains in Wall Street helped the peso CLP=CL advance 0.48 percent to 545.00/545.50 per dollar from Friday's close of 547.60/547.90.