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EMERGING MARKETS-Brazil assets rise on expected interest rate cut; Latam stocks rise

11 Dec 2019

* MSCI Latam stocks, currency indexes at over 1-mth highs * Brazil cut priced in, tightening cycle seen in 2020- Analyst * Higher metal prices support Chilean assets By Ambar Warrick Dec 11 Brazilian assets firmed on Wednesday on expectations the country's central bank will cut the benchmark Selic interest rate to a record low 4.5%, while Latin American stocks hit the highest in more than a month on hopes for U.S.-China trade talks. Regional markets were cautiously optimistic as reports suggested Washington was laying the groundwork to delay the latest tariffs against Chinese goods scheduled to take effect Dec. 15 deadline. "Until we see some confirmation, I think we'll see people getting a bit more nervous as that deadline nears," said William Jackson, chief emerging markets economist at Capital Economics in London. Markets were also anticipating the U.S. Federal Reserve would conclude its final meeting in 2019 by standing pat on rates. Brazil stocks rose while the real rose against the dollar to its strongest level in more than a month. Analysts believe markets have priced in what is expected to be the final rate cut of Brazil's current cycle. "The reason they're cutting rates is that the economy has been weakened, and now finally there's been a bit of a turnaround in some of the economic data and I think there's a bit more optimism," Capital Economics' Jackson added. "Financial markets at the moment seem to be expecting a tightening cycle from the second half of next year -- if the central bank downplays, or plays up expectations for that, it could shift the real one way or the other." The MSCI's index of Latin American stocks rose to the highest in more than a month, propped up chiefly by Brazilian stocks. Chilean equities rose to a three-week high, with steel producer CAP SA leading gains on the benchmark index, boosted by a jump in Chinese iron ore futures as increased bank lending in the country spurred hopes for demand. Chile's peso also firmed to the dollar, taking support from increased prices for copper, the country's top export. The Mexican peso and the Colombian peso both strengthened, while the MSCI's index of Latin American currencies touched the highest in more than a month. Key Latin American stock indexes and currencies at 0208 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1056.40 0.66 MSCI LatAm 2766.73 0.62 Brazil Bovespa 110817.51 0.13 Mexico IPC - - Chile IPSA 4800.73 0.86 Argentina MerVal - - Colombia COLCAP 1602.94 0 Currencies Latest Daily % change Brazil real 4.1176 0.73 Mexico peso 19.2153 0.20 Chile peso 772.9 0.72 Colombia peso 3391.45 0.36 Peru sol 3.3918 0.21 Argentina peso 59.7000 0.25 (interbank) (Reporting by Ambar Warrick in Bengaluru; Editing by David Gregorio)

EMERGING MARKETS-EM stocks inch up to 2-week high; U.S. Fed, China trade in focus

11 Dec 2019

Dec 11 Developing world stocks inched up on Wednesday, while currencies trod water ahead of the conclusion of a U.S. Federal Reserve policy meeting, with uncertainty over the Sino-U.S. trade war adding to the cautious mood.

EMERGING MARKETS-Brazil stocks pause for breath after record-high run; Latam assets subdued

10 Dec 2019

* Brazil stocks down after four sessions of record highs * Brazil central bank cut largely expected on Wednesday * Chilean peso down as poll sees Q4 GDP contraction By Ambar Warrick Dec 10 Brazilian stocks dipped on Tuesday while broader Latin American assets were subdued following a report of a possible delay to further U.S. tariff action on China. A Wall Street Journal report said that U.S. and Chinese trade negotiators were discussing a delay on a round of tariffs set to kick in on Dec. 15. Anticipation of the tariffs has kept global equities in tight ranges this week, as investors fear an interim trade deal between Washington and Beijing would not be met before the deadline. Brazilian stocks ticked lower after marking a new record high over the past four sessions, while the MSCI's indexes of Latin American stocks and currencies were largely flat. Brazil's central bank will lower its key interest rate to a new low on Wednesday, according to the unanimous view of economists in a Reuters poll, although recent strength in Latin America's largest economy suggests that it may be the last cut in the cycle. The real was weaker against the dollar. Chilean stocks inched up, while the peso weakened after strengthening to the dollar for about five days. Chile's economy is expected to shrink by 2.5% in the last quarter of 2019, according to a monthly poll of analysts, the latest of several dire predictions following weeks of protests. The Mexican peso was largely flat ahead of the signing of a United States-Mexico-Canada Agreement over labor, steel and aluminum. Argentine stocks rose, while the peso was flat as the new Peronist leader Alberto Fernandez assumed the presidency. Latin American stock indexes and currencies at 0242 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1049.26 -0.18 MSCI LatAm 2743.78 -0.11 Brazil Bovespa 110708.14 -0.24 Mexico IPC - - Chile IPSA 4767.23 0.4 Argentina MerVal 36578.84 0.466 Colombia COLCAP 1610.30 0.31 Currencies Latest Daily % change Brazil real 4.1445 -0.39 Mexico peso 19.2539 -0.13 Chile peso 778.2 -0.39 Colombia peso 3423.78 -0.31 Peru sol 3.3848 -0.32 Argentina peso 59.9500 0.00 (interbank) (Reporting by Ambar Warrick in Bengaluru; editing by Grant McCool)

EMERGING MARKETS-Stocks, currencies flat amid U.S.-China tariff jitters

10 Dec 2019

Dec 10 Stocks were little changed on Tuesday, less than a week before the United States is due to impose more tariffs on Chinese goods.

EMERGING MARKETS-Latam markets hold at 1-month highs as focus turns to China tariff deadline

09 Dec 2019

* MSCI Latam stocks, currency indexes retain last-week's gains * Dec. 15 U.S.-China tariffs to delay likely EM recovery -analysts * Metal prices rise as strength in Chinese imports implies demand * Chilean peso up for fifth straight day after C.bank stimulus By Ambar Warrick Dec 9 Latin American markets held around a month's high on Monday, building slightly on gains made last week as the focus turned to the upcoming deadline on further U.S. tariff action against China. Lower-than-expected export data from China served to remind investors of the economic slowdown bought about by the Sino-U.S. trade war, although markets have so far held out hope for an interim deal before the Dec. 15 deadline. "If the December 15 tariffs on China go ahead, then our view is going to come under more significant pressure, with the anticipated EM growth recovery pushed from Q1 2020 to Q3 2020," Morgan Stanley analysts wrote in a note. Strong Chinese imports pointed to robust demand for copper within the country's manufacturing space, pushing up prices, while perceived increases in demand for iron ore in China's steel mills supported Chinese iron ore futures. Increased prices for the materials, which are major exports for Latin American economies, saw buying into assets linked to them, such as the Chilean peso and iron ore miner Vale SA , which is among the largest stocks on the Brazilian stock index. The Bovespa was flat but just a few points shy of a record high, with the index having conquered a new peak for a bulk of last week's sessions. Shares of Brazil's largest domestic airline, Gol Linhas Aereas Inteligentes SA, and those of its listed loyalty program, Smiles Fidelidade, were the top gainers on the Bovespa after the former offered to buy out the latter's minority shareholders at a roughly 25% premium. The MSCI's indexes of Latin American stocks and currencies hovered around one-month highs. The Brazilian real weakened slightly to the dollar after logging its best week in more than one month. The Chilean peso surged for a fifth straight session after the country's central bank launched a large stimulus program. The currency was also supported by stronger prices for copper, the country's top export. Argentina's peso was largely unchanged after President-elect Alberto Fernandez signaled a policy shift with his new cabinet. Key Latin American stock indexes and currencies at 0210 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1051.84 0.27 MSCI LatAm 2741.72 0.31 Brazil Bovespa 111096.40 -0.03 Mexico IPC - - Chile IPSA 4717.20 -0.14 Argentina MerVal - - Colombia COLCAP 1611.67 0 Currencies Latest Daily % change Brazil real 4.1569 -0.29 Mexico peso 19.2935 0.04 Chile peso 770.5 0.85 Colombia peso 3418.01 0.07 Peru sol 3.3798 -0.08 Argentina peso 59.9300 0.03 (interbank) (Reporting by Ambar Warrick in Bengaluru; Editing by Steve Orlofsky)

EMERGING MARKETS-EM stocks edge up tracking Wall St; U.S.-China tariff deadline looms

09 Dec 2019

Dec 9 Most emerging stock markets rose on Monday, tracking Wall Street's rally in the prior session, although a surprise drop in Chinese exports checked larger gains, with the focus turning to an upcoming deadline on further U.S. tariffs on Chinese goods.

EMERGING MARKETS-Brazilian real rises as U.S. jobs data fuels LatAm FX rally

06 Dec 2019

(Updates prices) * Brazil's real snaps four straight weeks of losses * Argentine president-elect Fernandez's cabinet in focus * Brazil stocks propped up by resources play By Susan Mathew and Ambar Warrick Dec 6 Most Latin American currencies firmed on Friday, with Brazil's real rising to four-week highs, as robust jobs numbers from the United States combined with optimism over Sino-U.S. trade talks to lift sentiment. U.S. job growth increased by the most in 10 months in November, data showed, confirming that the economy remained on a moderate expansion path. This quelled some fears of a deceleration in growth in the world's largest economy. "(The U.S. data) should lend support to the likely FOMC message next week that both the economy and monetary policy remain in a "good place". We expect the Fed to keep rates on hold at Wednesday's meeting," strategists at TD Securities said. Cuts to the U.S. benchmark borrowing rate have lent support to emerging market currencies this year. Against a strong dollar, Chile's peso rallied 0.7% and logged its best week in more than eight years as the country's central bank tried to prop up the currency which fell to a record low last week after anti-government riots. Brazil's real firmed 1% to its highest level in almost one month, as consumer price inflation bounced back to seven-month highs in November. The currency added about 2% this week to snap four straight weeks of losses. The Argentine peso was largely flat ahead of president-elect Alberto Fernandez announcing his cabinet, with the focus on who will be named treasury minister. With fewer than 10 days left before additional U.S. tariffs are imposed on Chinese goods, markets are holding out for a phase one trade deal. U.S. President Donald Trump said talks were "moving right along," and in a positive sign Beijing said it will waive import tariffs for some soybeans and pork shipments from the United States. In line with a rise on Wall Street, Brazilian stocks touched a fresh high for a third day. The Bovespa extended gains into a fifth straight session on sustained strength in energy and mining stocks, tracking commodity prices. Key Latin American stock indexes and currencies at 1930 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1050.27 0.71 MSCI LatAm 2751.50 1.52 Brazil Bovespa 111219.99 0.54 Mexico IPC 42021.19 -0.46 Chile IPSA 4723.26 -0.25 Argentina MerVal 36670.63 3.464 Colombia COLCAP 1612.57 -0.13 Currencies Latest Daily % change Brazil real 4.1434 1.07 Mexico peso 19.2928 0.39 Chile peso 777.05 0.48 Colombia peso 3420.5 1.21 Peru sol 3.377 0.06 Argentina peso 59.9400 0.08 (interbank) (Reporting by Ambar Warrick and Susan Mathew in Bengaluru; Editing by Alexander Smith)

EMERGING MARKETS-Latam markets eye best week in more than one month on trade optimism

06 Dec 2019

* Latam stocks, currencies set for best week since late-Oct * Brazil stocks propped up by resources play * Chilean peso eyes best week since Sept-2018 By Ambar Warrick Dec 6 Latin American stocks rose on Friday amid continued optimism over Sino-U.S. trade talks, while regional currencies continued to benefit from sustained weakness in the dollar. U.S. President Donald Trump on Thursday said trade talks are "moving right along," even as Beijing maintained its stance that some existing tariffs must come off as part of an interim agreement. With fewer than 10 days left before additional U.S. tariffs are imposed on Chinese goods, markets are holding out for a phase one trade deal. The MSCI's index of Latin American stocks was set for an eighth straight day of gains, pushed up by heavyweight Brazilian stocks. The Bovespa had touched a record high on Thursday, and was set for a fifth straight gaining session on sustained strength in energy and mining stocks, tracking robust commodity prices. Oil prices rose with OPEC and its allies set to formally agree to more output cuts in early 2020, while Chinese iron ore futures strengthened over the week on positive economic indicators from the country. Chilean stocks ticked up and were set for a third straight gaining session. The MSCI's index of Latin American currencies was set for its best week since late-October, and was also set to snap four straight weeks of losses. While weakness in the dollar has benefited emerging currencies this week, better than expected payrolls data for November could shift the tide in the greenback's favor. The Chilean peso made small moves but was set for its best week in more than a year amid continued efforts by the country's central bank to prop up the currency. The currency, which fell to a record low last week in the face of violent anti-government riots in the country, prompted a large stimulus program from the central bank that kicked off on Monday. Brazil's real traded sideways, as consumer price inflation bounced back to seven-month highs in November from ultra-low levels the month before but still remained below the central bank's target. The Argentine peso was largely flat ahead of President-elect Alberto Fernandez announcing his cabinet later in the day, with all eyes on who will be the new minister of Treasury. Key Latin American stock indexes and currencies at 0132 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1047.78 0.47 MSCI LatAm 2728.90 0.69 Brazil Bovespa 111063.23 0.4 Mexico IPC - - Chile IPSA 4740.26 0.11 Argentina MerVal - - Colombia COLCAP 1614.74 0 Currencies Latest Daily % change Brazil real 4.1884 -0.02 Mexico peso 19.3724 -0.02 Chile peso 780.3 0.06 Colombia peso 3443.28 0.54 Peru sol 3.3748 0.12 Argentina peso 59.9400 0.08 (interbank) (Reporting by Ambar Warrick in Bengaluru)

EMERGING MARKETS-Stocks at one-week high as Trump talks up China talks

06 Dec 2019

Dec 6 Emerging-market stocks touched a one-week high on Friday, tracking global equities higher, as Sino-U.S. trade optimism grew after encouraging comments from U.S. President Donald Trump.

EMERGING MARKETS-Latam stocks at over three-week high as Brazil mounts record peak

05 Dec 2019

* MSCI's Latam stock index at highest since Nov 12 * Chile stocks, peso surge as C.bank holds benchmark rate * Argentine stocks down as C.bank chief resigns By Ambar Warrick Dec 5 Latin American stocks touched a more than three-week high on Thursday, with Brazilian stocks at a record peak as the country's senate approved a military pension reform bill. Stocks took support from lingering optimism over the Sino-U.S. trade war, after a Bloomberg report as well as positive comments from U.S. President Donald Trump brewed some hope over a "phase-one" trade deal. Regional markets have also been propped up by some positive economic readings this week, with better-than-expected GDP data from Brazil, Latin America's largest economy, being the most notable. Brazilian stocks extended Wednesday's gains to touch a fresh record high, as the Senate on Wednesday approved a bill that restructures the military's career and welfare, part of President Jair Bolsonaro's government welfare reform. With a major overhaul of the pension system in October, Brazil's markets have been particularly sensitive to any progress in Bolsonaro's program of streamlining government finances and releasing money into the private sector. Chilean stocks rose to a near two-week high, while MSCI's index of Latin American stocks rose as much as 0.3%. Chile's central bank on Wednesday said it would hold its benchmark interest rate and would likely keep it there for the next several months, even as weeks of protests begin to hammer the country's economy. However, the bank also slashed its economic growth forecasts for 2019 and 2020 on Thursday, warning that the effects of weeks of unrest would linger into next year. "Though it’s too early to say, especially if the Chilean peso reverses quickly and beyond the central bank's expectations, the higher inflation forecasts bias the next move to a hike," Citi analysts wrote in a note. "As for FX, a hawkish central bank with no cuts on the horizon should help stabilize the currency, which has been plagued by its low carry." The Chilean peso rose to its strongest level against the dollar in more than two weeks. The currency has been propped up by a massive central bank stimulus program, which went into effect earlier in the week. On the other hand, Argentine stocks dropped after central bank chief Guido Sandleris resigned on Wednesday, an expected step as Latin America's third-largest economy transitions to Peronism next week under newly elected President Alberto Fernandez. MSCI's index of Latin American currencies edged lower after four straight days of gains. Key Latin American stock indexes and currencies at 2333 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1041.67 0.49 MSCI LatAm 2709.95 0.19 Brazil Bovespa 110628.48 0.3 Mexico IPC - - Chile IPSA 4732.41 1.88 Argentina MerVal 34269.94 -1.216 Colombia COLCAP 1610.27 -0.11 Currencies Latest Daily % change Brazil real 4.2104 -0.21 Mexico peso 19.3718 0.28 Chile peso 783.8 0.51 Colombia peso 3456.09 0.33 Peru sol 3.3728 0.18 Argentina peso 59.8800 0.01 (interbank) (Reporting by Ambar Warrick in Bengaluru)

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