March 11, 2019 / 9:53 PM / 13 days ago

EMERGING MARKETS-Latin American stocks jump; pension reform optimism lifts Brazil shares

 (Recasts throughout, updates prices)
    * Brazil shares up 2.8 percent
    * Mexican shares break 10-day losing run
    * Argentine peso falls after Friday's over 3 percent jump

    By Susan Mathew
    March 11 (Reuters) - Latin American stocks surged on Monday,
swept up in a global rally, while Brazilian shares posted their
best day in more than two months, boosted by the government's
attempts for a speedy overhaul of the country's bloated pension
program.
    MSCI's index of Latin American stocks jumped
2.5 percent, clocking its best day since Jan. 2, with Brazil's
Bovespa index closing up 2.8 percent.
    Brazil's President Jair Bolsonaro on Friday kept up pressure
on Congress to vote soon on the pension reform plan presented
last month, ahead of Commission on Constitution and Justice's
review of the proposal on Wednesday, saying delaying the vote
could lead to economic chaos.
    "We're likely going to see more public campaigning by the
president, which is the most effective way to put pressure on
Congress to garner the votes and prevent the reform from being
watered down too much," analysts at Citigroup said in a note.
    The economy ministry warned last month that leaving the
pension system as it is could trigger a deep recession starting
in the second half of next year. Lower house of Congress speaker
Rodrigo Maia had said in February that the reform could be
approved in both chambers by July. 
    Gains on the Bovespa were broad-based, with only nine of its
65 components in the red. 
    Top gainer was steel maker Companhia Siderurgica Nacional
(CSN), up 5.8 percent. Credit Suisse raised the
company's target price by 4 reais, to 15 reais, on the
brokerage's increased iron ore price expectations and optimism
regarding the CSN's path toward deleveraging.
    State oil firm Petróleo Brasileiro SA soared 5.7
percent after it announced plans to cut $8.1 billion from its
operational costs in the period from 2019 through 2023.

    Most other regional stock markets also rose, tracking Wall
Street's move higher, and a global rally powered by talk of more
stimulus from China.
    Argentina's Merval stock index climbed 2.3 percent,
rising for the first time in four sessions, while Mexico's IPC
index broke a 10-session losing streak - its longest in
more than three years - to close 0.7 percent higher. 
    Mexico's Finance Minister Carlos Urzua on Friday said the
government will likely announce significant new measures to help
debt-laden state oil company Pemex later this month, as it tries
to avert a threatened credit rating downgrade to "junk."

    Rating agencies S&P and Fitch downgraded Pemex over the last
two months, leaving questions hanging over Mexico's sovereign
credit rating. 
    Latin American currencies, meanwhile, pared most of the
gains made earlier in the session against a weaker dollar.
Brazil's real closed marginally higher after having
firmed more than 0.7 percent, while the Mexican peso
inched lower.
    The Argentine peso closed down 0.4 percent. On
Friday, the currency had gained more than 3 percent after the
central bank hiked the rates offered on short-term "Leliq" notes
to lure traders back to the currency after it hit a record low
the day before. 
    
    Key Latin American stock indexes and currencies at 2108 GMT:
 
    Stock indexes             Latest    Daily %
                                         change
 MSCI Emerging Markets         1041.15      1.07
                                        
 MSCI LatAm                    2796.82      2.47
                                        
 Brazil Bovespa               98026.62      2.79
                                        
 Mexico IPC                   41876.17       0.7
                                        
 Chile IPSA                    5299.33      0.46
                                        
 Argentina MerVal             33790.68      2.33
                                        
 Colombia IGBC                12494.58      1.47
                                        
                                                
       Currencies             Latest    Daily %
                                         change
 Brazil real                    3.8397      0.00
                                        
 Mexico peso                   19.3945      0.00
                                        
 Chile peso                     670.05      0.11
                                        
 Colombia peso                  3177.2      0.00
 Peru sol                        3.307      0.21
                                        
 Argentina peso                41.2500     -0.12
 (interbank)                            
                                        
 

 (Reporting by Susan Mathew in Bengaluru; editing by Jonathan
Oatis)
  
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