December 21, 2017 / 10:20 PM / a month ago

EMERGING MARKETS-Brazil stocks rise on deal news, Mexican peso falls

 (Updates prices, context)
    SAO PAULO, Dec 21 (Reuters) - Brazil's blue-chip Bovespa
index saw strong gains on Thursday, boosted by news of a
potential M&A deal, while the Mexican peso sank to its lowest
level since March on a disappointing inflation report.
    The Bovespa jumped 2.4 percent after planemakers Boeing Co
 and Brazil's Embraer SA said they were
discussing a "potential combination". Embraer's shares soared
more than 20 percent on the news.
    Brazilian equities were also boosted by comments by Finance
Minister Henrique Meirelles that temporarily warded off fears of
a credit downgrade.
    Speculation has swirled that major credit ratings agencies
will downgrade Brazil's debt as legislators struggle to pass
pension legislation seen as key to shoring up the country's
budget deficit.
    However, Meirelles said he had not discussed a credit
downgrade in recent meetings with S&P, Fitch and Moody's, adding
that he had received no information suggesting such a move was
imminent.
    The Bovespa was also aided by the performance of state-owned
oil major Petroleo Brasileiro SA, known as Petrobras,
whose shares shot up after the company unveiled an investment
plan projecting $74.5 billion of capital expenditure from 2018
to 2022.
    Meanwhile, the Mexican peso fell 1.39 percent after
data showed that inflation had accelerated more than expected on
rising prices of fruits, vegetables and energy.
    The currency fell to its lowest level since March before
paring some losses to trade at 19.48 pesos per dollar.
    Mexico's IPC stock exchange fared better, rising 0.22
percent, mirroring gains on Wall Street.
    ($1 = 3.30 reais)
     
Key Latin American stock indexes and currencies at 2100 GMT:
    
 Stock indexes                             daily %     YTD %
                               Latest       change    change
 MSCI Emerging Markets           1134.72      0.17     31.38
                                                    
 MSCI LatAm                      2789.30      0.67     18.37
                                                    
 Brazil Bovespa                 75133.43      2.41     24.75
                                                    
 Mexico S&P/BVM IPC             48495.91      0.22      6.25
                                                    
 Chile IPSA                      5450.83     -1.41     31.30
                                                    
 Chile IGPA                     27454.47     -1.23     32.41
                                                    
 Argentina MerVal               28480.71      1.47     68.35
                                                    
 Colombia IGBC                  11203.76      0.37     10.62
                                                    
 Venezuela IBC                   1280.33     -0.48    -95.96
                                                    
                                                            
 Currencies                                daily %     YTD %
                                            change    change
                                  Latest            
 Brazil real                      3.3068      0.05     -1.74
                                                    
 Mexico peso                     19.4800     -1.39      6.49
                                                    
 Chile peso                        620.5     -0.02      8.09
                                                    
 Colombia peso                    2965.2     -0.21      1.22
 Peru sol                          3.267      0.00      4.50
                                                    
 Argentina peso (interbank)      17.9300     -0.92    -11.46
                                                    
 Argentina peso (parallel)         18.04      0.11     -6.76
                                                    
 
 (Reporting by Gram Slattery; additional reporting by Julia
Love; Editing by James Dalgleish and Rosalba O'Brien)
  
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