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Bonds News

EMERGING MARKETS-Mexican peso hits 8-month high, stocks rally as Biden leads in U.S. vote count

    * Mexican peso rises for third straight day
    * Brazil's real jumps after encouraging services PMI
    * Russian rouble gains, Hungarian forint leads among CEE FX
    * Emerging market stocks touch highest level since May 2018

 (Updates prices throughout)
    By Shreyashi Sanyal
    Nov 5 (Reuters) - Mexico's peso touched its highest level in
nearly eight months against a weakening dollar on Thursday,
while emerging market stocks hit multi-year highs as Democratic
candidate Joe Biden maintained a narrow lead in U.S. election
vote counting.
    The peso rose for the third straight day, jumping
over 1% as a Biden victory would be seen as positive for the
currency, which has suffered from Republican President Donald
Trump's hard line on trade.  
    The election is coming down to close contests in five states
with Biden narrowly ahead of Trump in some battleground states,
as mail-in and absentee votes were being counted.
    Brazil's real jumped 1.6% after a purchasing
managers' survey showed the services sector expanded in October
at the fastest rate since January, driving the strongest private
sector growth in Latin America's largest economy in over a
decade.
    The real has fallen 27% so far this year, with record low
interest rates adding pressure on the currency. There have also
been concerns around how Brazil's government will fund a new
fiscal program without overshooting its spending ceiling.  
    Brazil's central bank president Roberto Campos Neto said the
bank could withdraw its "forward guidance" pledge to keep
interest rates low for a long time if the government honors its
spending cap but uses creative ways to increase spending.

    Argentina's central bank will hold interest rates stable at
its weekly directors meeting, a bank source told Reuters on
Thursday, following a period of adjustments as part of a move to
"harmonize" different rates. The country's peso was
flat.
    Emerging market currencies also got a lift from a fading
dollar which was headed for its biggest three-day drop
since March ahead of the outcome of a U.S. Federal Reserve
policy meeting that might hint at more stimulus.
    The Russian rouble was among the smallest of gainers,
rising just 0.2% as traders returned from a public holiday on
Wednesday. Russia has benefited from Trump's commitment to oil
and close ties with President Vladimir Putin.   
    South Africa's rand firmed against the dollar, while
Hungary's forint led gains across central European
currencies with a 1.7% jump against the euro.
    Emerging market stocks hit their highest level
since May 2018, with bourses in Russia, South Africa
 and Brazil rising between 2.5% and 3%. The
MSCI's index of emerging market stocks was set for its best day
since July.    
    Latin American stock indexes and currencies at 1854 GMT:
 
          Stock indexes                  Latest   Daily %
                                                  change
 MSCI Emerging Markets                   1166.88     2.79
 MSCI LatAm                              1969.66     4.19
 Brazil Bovespa                         99967.47     2.15
 Mexico IPC                             38135.91     1.76
 Chile IPSA                              3675.32     4.47
 Argentina MerVal                       48214.99    2.523
 Colombia COLCAP                         1158.40     0.17
                                                         
             Currencies                  Latest   Daily %
                                                  change
 Brazil real                              5.5645     1.64
 Mexico peso                             20.6820     1.06
 Chile peso                                  756    -0.25
 Colombia peso                           3754.97     1.56
 Peru sol                                 3.5938     0.17
 Argentina peso (interbank)              79.0900    -0.08
                                                  
 Argentina peso (parallel)                   153     5.23
                                                  
 
 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Kirsten
Donovan and Grant McCool)
  
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