June 2, 2018 / 12:12 AM / a year ago

EMERGING MARKETS-Brazil stocks rise despite Petrobras slide after CEO exit

 (Updates with closing prices, details)
    By Bruno Federowski
    BRASILIA, June 1 (Reuters) - Brazilian financial markets
closed up on Friday despite a slump in shares of Petroleo
Brasileiro SA following the resignation of the
state-controlled oil company's chief executive.
    Pedro Parente, outgoing CEO of Petrobras, as the company is
known, quit on Friday after a paralyzing nationwide truckers'
strike forced the government to lower diesel prices.
    The move fueled concerns that the government could again
meddle with the company's pricing policy, a practice that
boosted Petrobras' debt which Parente had helped to stave off.
    "It's clear that the government does not want to undercut
Petrobras, but it's become more and more likely that it will run
out of options," said a partner at a São Paulo-based portfolio
manager, who cut his exposure to Petrobras shares by half in the
wake of Parente's resignation.
    Petrobras preferred shares closed down almost 15
percent, extending a rout that has erased nearly 40 percent of
its market value since the beginning of the truckers' strike on
May 21. The firm's common shares fell 14.9 percent. 
    Common shares in meatpacker BRF SA, whose board
is chaired by Parente, rose 9.2 percent, the biggest gainer on
the Bovespa stock index, which climbed 0.63 percent. 
    Still, the Brazilian real weakened by 0.8 percent,
easily the biggest loser among Latin America's currencies.
    Mexico's S&P/BMV IPC, which in May suffered its worst
monthly performance since February 2009, rose nearly 0.8
percent. The Mexican peso, which touched a 15-month low
on Thursday, slipped by 0.13 percent.
    Demand for emerging market currencies has wavered in recent
months as data showing accelerating inflation and concerns over
a widening fiscal deficit in the United States bumped up U.S.
bond yields.
    Key Latin American stock indexes and currencies at 2345 GMT:
 Stock indexes                 Latest        Daily     YTD
                                               pct     pct
                                            change  change
 MSCI Emerging Markets           1,130.22     0.85   -2.44
 MSCI LatAm                      2,568.78     0.32   -9.17
 Brazil Bovespa                 77,239.75     0.63    1.10
 Mexico IPC                     45,013.12     0.78   -8.80
 Chile IPSA                      5,471.32     0.30   -1.68
 Chile IGPA                     27,705.23     0.29   -0.98
 Argentina MerVal               28,436.75    -0.43   -5.41
 Colombia IGBC                  12,435.11     1.12    9.36
 Currencies                                  Daily     YTD
                                               pct     pct
                                   Latest   change  change
 Brazil real                       3.7667    -0.80  -11.97
 Mexico peso                      19.9329    -0.13   -1.30
 Chile peso                         631.0     0.11   -2.71
 Colombia peso                   2,867.90     0.78    3.88
 Peru sol                           3.272    -0.06   -0.97
 (Reporting by Bruno Federowski, editing by G Crosse and Cynthia
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