Bonds News

EMERGING MARKETS-Latam FX, stocks rally as dollar dogged by election jitters

    * Brazil's real gains on strong manufacturing data
    * Markets pricing in a Biden win
    * Latam FX to benefit from Biden win- Reuters poll

    By Ambar Warrick
    Nov 3 (Reuters) - Brazilian stocks and the real rose on
Tuesday after better-than-expected manufacturing data, with most
other Latin American currencies recovering from recent falls as
the dollar weakened going into the U.S. presidential elections. 
    The real added about 1.1%, with a survey showing that
 manufacturing activity reached a record high in October as a
rise in employment and export orders to new highs helped extend
a recovery in Latin America's largest economy.
    Brazilian stocks rose 1.7% after a long weekend.
Minutes from Brazil's latest central bank meeting struck a more
hawkish tone than its Oct. 27-28 policy statement which pointed
to low interest rates for a long time.
    Mexico's peso rose 1.1% after a rough start to the
week. Still, the currency, and Colombia's peso are
expected to stay under pressure from weakness in the oil market.
    Chile's peso jumped to a more than two-week high as
improving factory data around the globe boosted prices for
copper, the country's largest export.
    Latin American stocks also rose on the day. The MSCI's index
of stocks added 2.6%.
    The day's gains in Latin America, and broader emerging
markets were underpinned by investors pricing in a Joe Biden
victory in the U.S. presidential elections.
    Analysts believe a Biden win would pressure the dollar as he
is expected to spend big on stimulus and take a freer approach
to trade, which is likely to benefit other currencies.
    "Despite all the other forces, the U.S. election will likely
suck away all the oxygen for the coming sessions.  Market
consensus currently expects a Blue Wave, which on our estimates
is worth about 2% USD downside," Mark McCormick global head of
FX strategy at TD Securities wrote in a note.
    A Reuters poll said Latin American currencies are poised to
edge up in the event of a Democrat win, but domestic challenges
will continue to hold them back.
    The coronavirus pandemic had exacerbated economic problems
in Latin America, raising concerns over the fiscal strength of
several major economies as economic output dropped and
governments took on more debt to cushion the pandemic's impact.
    Key Latin American stock indexes and currencies:
                              Latest      Daily % change
 MSCI Emerging Markets         1127.72                1.16
 MSCI LatAm                    1858.95                2.64
 Brazil Bovespa               95507.78                1.66
 Mexico IPC                       0.00                   0
 Chile IPSA                    3589.35                0.51
 Argentina MerVal                    -                   -
 Colombia COLCAP               1136.75                   - Currencies             Latest      Daily % change
 Brazil real                    5.6744                1.10
 Mexico peso                   21.1345                1.13
 Chile peso                        759                1.12
 Colombia peso                 3825.38                0.99
 Peru sol                       3.6077                0.19
 Argentina peso                78.8300               -0.18

 (Reporting by Ambar Warrick in Bengaluru; editing by Emelia