December 28, 2018 / 10:21 PM / in 22 days

EMERGING MARKETS-Latam currencies mixed; Brazil stocks end 2018 on high note

 (Recasts throughout, updates prices, adds market strategist's
quote)
    By Agamoni Ghosh
    Dec 28 (Reuters) - Latin American currencies were mixed
against the dollar on Friday but were on track to post weekly
gains as regional stocks rose in line with emerging markets
worldwide, and indexes such as Brazil's Bovespa capped 2018 with
a strong finish.
    The greenback dipped as U.S. stocks ended a dramatic week
capped by large price swings, helping to boost the Japanese yen
and currencies such as the Argentinean and Chilean pesos
. But Brazil's real slipped 0.2 percent.
    MSCI's index for Latin American stocks rose
over 2 percent for the day to post its first weekly gain in four
weeks. Indexes in Sao Paulo and Buenos Aires
chalked up robust gains.
    Most stock indexes in the region had their final trading day
of 2018, with Brazil's Bovespa rising over 2 percent in a
broad-based rally and emerging as one of the top performing
indexes this year, up almost 15 percent.
    Index heavyweights, state-controlled oil firm Petrobras
 and iron ore miner Vale were up 47 and 32
percent respectively this year. 
    Investors will be eyeing President-elect Jair Bolsonaro's
swearing-in next week which has been clouded by a lingering
financial scandal involving his son, but markets have so far
welcomed his policy pledges that could transform his country.   
    "The market's expectation for the Bolsonaro government
remains positive," said UBS Brazil's chief economist and former
Central Bank Director Tony Volpon.
    Argentina's stock markets clocked gains in the year's final
session to end 2018 marginally higher, but its currency had the
worst year on record as Latin America's third-largest economy
plunged into financial crisis.
    A bailout by the International Monetary Fund (IMF) has
managed to restore some market confidence in Argentina after
investors pulled money out of the nation, leaving the government
and companies that hold debt in dollars in turmoil. 
    "Argentina seems to have found temporary relief. ... FX is
stabilized with a contractionary monetary and fiscal policy, and
we do not expect FX reserve losses from intervention," said Citi
analysts in a 2019 outlook report. 
    The Chilean stock market gained for the day but
ended the year with a 8.3 percent decline, its biggest in five
years, pressured by shares of lithium producer SQM and
LATAM Airlines, and fears about global economic growth.

    The Chilean peso weakened 11.4 percent against the dollar in
2018 as the price of copper, the country's main export, fell. 
    Mexico's IPC index closed marginally higher on the
day while its currency hovered around 7-week highs. 

    Key Latin American stock indexes and currencies at 2120 GMT
    
 Stock indexes                             daily %     YTD %
                               Latest       change    change
 MSCI Emerging Markets            962.63      1.08     -16.9
                                                    
 MSCI LatAm                      2569.28      2.63     -9.15
                                                    
 Brazil Bovespa                 87887.26      2.84     15.03
                                                    
 Mexico IPC                     41518.45      0.24    -15.88
                                                    
 Chile IPSA                      5105.43      0.69     -8.32
                                                    
 Argentina MerVal               30292.55      2.62      0.75
                                                    
 Colombia IGBC                  11144.08     -0.36     -1.99
                                                    
                                                            
 Currencies                                daily %     YTD %
                                            change    change
                                  Latest            
 Brazil real                      3.8784     -0.09    -14.57
                                                    
 Mexico peso                     19.6631      0.02      0.18
                                                    
 Chile peso                        693.7      0.40    -11.40
                                                    
 Colombia peso                      3245      0.86     -8.10
 Peru sol                          3.372     -0.06     -4.00
                                                    
 Argentina peso (interbank)      37.6500      1.86    -50.60
                                                    
 
    

 (Reporting by Agamoni Ghosh in Bengaluru; Additional reporting
by Claudia Violante in Sao Paulo; Editing by Richard Chang)
  
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