August 16, 2019 / 2:29 PM / a month ago

EMERGING MARKETS-Latam stocks rise, Argentine peso attempts recovery

    By Agamoni Ghosh
    Aug 16 (Reuters) - Latin American stocks rose on Friday with
a global rebound in equities, as expectations of further
stimulus by central banks offset worries of sluggish economic
growth, while Argentina's peso was set to record its worst week
in over 3 years.  
   MSCI's index of Latin American stocks rose
0.8% led by gains on Brazil's Bovespa. 
    The index was still on track to lose close to 6% through a
chaotic week as mounting worries of a global recession sparked
in part by the long-drawn U.S.-China trade war, kept investors
on the edge.
   The Argentine peso rose 1.8%, attempted a mild rebound
from a near-twenty percent fall this week which came on the back
of a surprise defeat for sitting President Mauricio Macri in the
presidential primaries on Sunday.  
   To lift battered market sentiment, Macri announced an end to
sales taxes on basic food products until the end of the year,
while central bank barred private banks from having total dollar
holdings exceeding 5 percent from Aug 20 onwards.
    Mexico's peso was marginally higher a day after the
central bank cut its key lending rate for the first time in five
years citing slowing inflation and increasing slack in the
economy.
    "If you were to look at the pure nuts and bolts of the
Mexican economy, which is low growth and inflation has come down
significantly, the rate cut is long overdue," said David Rees,
emerging market strategist at J. Safra Sarasin Asset Management.
    "That central bank is still cautious though and as there is
a lot going on in the background. So we have to see if the Fed
cuts rate in September and then probably Mexico will follow."   
 
    The surprise move by Mexican policymakers follows rate cuts
by central banks around the world in the last week as a
trade-induced slowdown shows more signs of hindering global
growth. 
    Chile's peso rose only marginally, while stocks
 gained 0.5%. 
    
 Key Latin American stock indexes and currencies at 1411 GMT
 Stock indexes                         daily % change
                             Latest   
 MSCI Emerging Markets        968.14             0.48
                                      
 MSCI LatAm                  2594.64              0.6
                                      
 Brazil Bovespa             99338.60             0.28
                                      
 Mexico IPC                 38857.46             0.73
                                      
 Chile IPSA                  4800.19             0.5
                                      
 Argentina MerVal                  -                -
                                      
 Colombia IGBC              12428.38              0.3
                                      
                                                     
 Currencies                            daily % change
                                      
                              Latest  
 Brazil real                  3.9977             0.15
                                      
 Mexico peso                 19.5808             0.11
                                      
 Chile peso                   709.75             0.08
                                      
 Colombia peso               3445.08             0.69
 Peru sol                          -                -
                                      
 Argentina peso              56.8500             1.27
 (interbank)                          
                                      
 

 (Reporting by Agamoni Ghosh and Aaron Saldanha in Bengaluru
Editing by Nick Zieminski)
  
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