February 6, 2018 / 4:21 PM / 2 months ago

EMERGING MARKETS-LatAm markets range-bound despite global stock selloff

    By Bruno Federowski
    SAO PAULO, Feb 6 (Reuters) - Latin American markets moved
little on Tuesday even as world stock markets nosedived for a
fourth day, supported by expectations of strengthening global
economic growth. 
    Investors have scrambled for the exits after recent data on
U.S. wage growth fueled expectations of faster interest rate
hikes, driving 10-year U.S. Treasury yields to
four-year highs. [nL8N1PW5QD
    Debate has raged over whether the recent tumble was a
healthy correction following a January rally or a fundamentally
driven rout. Emerging markets had risen sharply after
stronger-than-expected global growth figures.
    Latin American observers were cautiously optimistic.
    "This crash, in my view, is not essentially bullish USD,"
Santander Brasil director Sandro Sobral wrote in a client note.
"Let's see if panic comes. In this case, we're going to use this
move to take risk in Brazil."
    The Brazilian real slipped 0.4 percent after firming
as much 0.2 percent.
    After the currency posted its worst week in eight months,
the central bank signaled it would fully roll over $6.2 billion
worth of currency swaps due on March.
    The swaps function like sales of dollars for future delivery
and are typically used to hedge against weakness in the
Brazilian real.
    Brazil's benchmark Bovespa stock index was barely
affected by the global rout, erasing earlier declines to rise
0.7 percent.
    Shares of lender Itaú Unibanco Holding SA jumped
after the nation's largest private bank forecast strong results 
and said it was raising its dividend
    Shares of other banks, such as Banco do Brasil SA
and Banco Bradesco SA, followed along.

    Wireless carrier TIM Participações SA posted the
biggest gain in the index, lifted by strong fourth-quarter
results.
    Most other stock indexes in the region seesawed, with
Argentina's Merval up after losing over 10 percent in
the prior two trading days.
    Mexico's S&P/BMV IPC index, however, tumbled 2.4
percent, adjusting to the recent selloff following a local
holiday.

    Key Latin American stock indexes and currencies at 1720 GMT:
 Stock indexes                              daily %    YTD %
                                             change   change
                                 Latest              
 MSCI Emerging Markets             1172.37    -3.06     4.39
                                                     
 MSCI LatAm                        3043.56    -0.83     8.52
 Brazil Bovespa                   82458.31     0.73     7.93
 Mexico IPC                       49204.69    -2.36    -0.30
 Chile IPSA                        5676.08    -0.97     2.00
 Chile IGPA                       28626.91    -0.92     2.31
 Argentina MerVal                 31507.39     1.16     4.80
 Colombia IGBC                    11778.43     0.51     3.59
                                                            
 Currencies                                 daily %    YTD %
                                             change   change
                                    Latest           
 Brazil real                        3.2590    -0.41     1.67
                                                     
 Mexico peso                       18.7900    -0.05     4.84
                                                     
 Chile peso                          601.1     0.22     2.25
 Colombia peso                     2839.63     0.03     5.01
 Peru sol                            3.252    -0.46    -0.46
                                                     
 Argentina peso (interbank)        19.6900    -1.07    -5.54
                                                     
 Argentina peso (parallel)           19.91     0.05    -3.42
                                                     
 
 (Reporting by Bruno Federowski; Editing by Jeffrey Benkoe)
  
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