June 22, 2020 / 2:55 PM / 23 days ago

EMERGING MARKETS-Latam stocks and currencies stage comeback, virus cases spike

    By Shreyashi Sanyal
    June 22 (Reuters) - Stocks and currencies across Latin
America bounced on Monday, tracking a global pick up in risk
appetite and higher prices for commodities even as new
coronavirus cases continued to rise at an alarming rate around
the world.
    Brazil's real jumped 2%, after posting its
worst weekly loss in eight weeks on Friday. 
    The country, which is the world's No. 2 coronavirus hot
spot, officially passed 50,000 coronavirus deaths on Sunday as
it also struggles with political flux and a crippled economy.
    Higher prices in oil and copper also helped lift the Mexican
, Colombian and Chilean pesos, while a
weaker dollar also supported the upward momentum in
emerging market currencies. 
    "Despite the surge in new cases, risk appetite is holding up
because confidence is higher with how doctors can treat the
virus and now that the virus is working its way through younger
individuals," said Edward Moya, senior market analyst, at OANDA
in New York.
    Analysts have also said the market's sentiment could be
driven by how strict the lockdown measures may be in the
occurrence of a full-blown second wave. 
    "The rise in the infection rate is unlikely to enhance
confidence in the markets, but there might come a point where
dealers become more accustomed to the situation, as a rise in
new cases is the risk a government takes when it reopens their
economy," said David Madden, market analyst at CMC Markets.
    Latin American currencies and stocks have been hit by
massive bouts of selling recently owing to dismal economic data
points and as a spike in cases in the region and globally have
fanned worries of a second wave of coronavirus infections. 
    And cases continued to rise as the World Health Organization
(WHO) reported a record increase in global novel coronavirus
cases on Sunday. The biggest increases were in North America and
South America.
    The MSCI's index of regional stocks rose
1.6% and Colombian stocks led gains on the day.
    Brazilian investment bank BTG Pactual jumped 13%
on plans to raise roughly 2 billion reais ($376.61 million)
through a share offering to boost its digital retail banking.
    
    Key Latin American stock indexes and currencies at 1434 GMT
    
 Stock indexes           Latest         Daily %
                                        change
 MSCI Emerging              1001.87           0.05
 Markets                             
 MSCI LatAm                 1970.04           1.55
                                     
                                     
 Brazil Bovespa            96351.77          -0.23
                                     
 Mexico IPC                38011.61          -1.02
                                     
 Chile IPSA                 4033.95           0.18
                                     
 Argentina MerVal          41068.51          0.286
                                     
 Colombia COLCAP            1161.41           1.97
                                     
                                                  
    Currencies           Latest         Daily %
                                        change
 Brazil real                 5.2110           2.03
                                     
 Mexico peso                22.3489           1.27
                                     
 Chile peso                   810.7           0.58
                                     
 Colombia peso              3729.73           0.36
                                     
 Peru sol                    3.4837           0.49
                                     
 Argentina peso             69.9700          -0.24
 (interbank)                         
                                     
 

 (Reporting by Shreyashi Sanyal in Bengaluru
Editing by Alistair Bell)
  
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