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Bruno Federowski

EMERGING MARKETS-Brazil markets underpeform on profit-taking before new poll

5:57pm BST

By Bruno Federowski BRASILIA, Sept 24 The Brazilian real underperformed its peers as traders booked profits from last week's gains ahead of another poll on next month's elections due later on Monday. Volatility has spiked in Brazilian markets ahead of the most hard-to-predict presidential vote in decades, with assets reacting sharply to each voter intention survey. Far-right lawmaker Jair Bolsonaro has consistently led in recent polls but he would face stiff competition from leftist Fernando Haddad in a likely second-round vote. Traders fear Haddad could take a lax stance on fiscal policy, failing to curb the deficit and driving away the possibility that Brazil will recover its investment grade sovereign rating. The real slipped 0.7 percent on a day when most currencies in the region were range-bound. The Mexican peso slipped 0.2 percent, while the Colombian peso firmed 0.3 percent. The Brazilian currency had posted its best week since July 2017 last week as traders bet on a Bolsonaro victory. Brazil's benchmark Bovespa stock index fell 1.3 percent, weighed down by a decline in shares of Vale SA after the miner's stock closed at a record high on Friday. Blue-chip lenders such as Banco do Brasil SA, Banco Bradesco SA and Itaú Unibanco Holding SA also fell, dragged down by anxiety over the vote. Key Latin American stock indexes and currencies at 1610 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1051.43 1.4 -9.24 MSCI LatAm 2546.94 1.49 -9.94 Brazil Bovespa 78441.73 -1.26 2.67 Mexico IPC 49210.59 -0.27 -0.29 Chile IPSA 5399.45 -1.14 -1.14 Argentina MerVal 33601.18 -2.11 11.76 Colombia IGBC 12377.13 1.16 8.85 Currencies daily % YTD % change change Latest Brazil real 4.0745 -0.70 -18.68 Mexico peso 18.8600 -0.15 4.45 Chile peso 668.8 -0.46 -8.10 Colombia peso 2987.53 0.28 -0.19 Peru sol 3.297 -0.12 -1.82 Argentina peso (interbank) 37.3200 -0.11 -50.16 Argentina peso (parallel) 38 0.66 -49.39 (Reporting by Bruno Federowski Editing by Tom Brown)

EMERGING MARKETS-Brazil markets up on election poll; Argentine peso jumps

21 Sep 2018

(Updates prices) By Bruno Federowski BRASILIA, Sept 21 Brazilian markets rose on Friday after an opinion poll suggested far-right lawmaker Jair Bolsonaro would do well against his main rival in a likely second-round vote in this year's presidential election. Bolsonaro has tapped University of Chicago-trained banker Paulo Guedes as his main economic advisor, leading investors to bet that he would act strongly to cut government spending and curb growth of public debt. Seeming contradictions between Guedes and Bolsonaro have raised questions over the lawmaker's commitment to market-friendly changes. Nevertheless, investors generally still prefer him over leftist Fernando Haddad, who seems most likely to face off against Bolsonaro in the second round. A phone-based survey published by XP Investimentos showed Bolsonaro remains in the lead for the first round and technically tied with Haddad in a second. Bolsonaro's rejection rate, however, was smaller than Haddad's, running contrary to other recent polls which have shown the opposite. Brazil's benchmark stock index was up 1.6 percent in afternoon trading, leading gains in the region. The Brazilian real firmed 0.74 percent on a day when currencies from Mexico, Colombia and Chile were either flat or slightly higher. "The XP survey is making investors cheerful, but there is little room for the currency to appreciate past 4.05," Miriam Tavares, head of currency trading at AGK brokerage, said. The Argentine peso was the biggest gainer in Latin American currency markets, rising 3.1 percent. The peso has been driven higher this week by optimism that the government will sign a revised standby financing deal with the International Monetary Fund that will include stricter fiscal measures. In Mexico, the benchmark stock index was down 0.38 percent and the peso was flat amid mounting pessimism about the future of the North American Trade Agreement, as the United States and Canada struggle to reach a deal. Key Latin American stock indexes and currencies at 1938 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1051.68 1.42 -10.49 MSCI LatAm 2559.86 2 -11.26 Brazil Bovespa 79367.96 1.6 3.88 Mexico IPC 49321.54 -0.38 -0.07 Argentina MerVal 34296.84 -0.63 14.07 Colombia IGBC 12240.33 0.28 7.65 Currencies daily % YTD % change change Latest Brazil real 4.0410 0.74 -18.01 Mexico peso 18.8090 0.02 4.73 Chile peso 665.7 0.23 -7.67 Colombia peso 2998 0.23 -0.53 Peru sol 3.293 0.09 -1.70 Argentina peso (interbank) 37.1000 3.10 -49.87 Argentina peso (parallel) 38 1.97 -49.39 (Reporting by Bruno Federowski; Additional reporting by Claudia Violante in São Paulo Editing by Alistair Bell and Rosalba O'Brien)

EMERGING MARKETS-Brazil markets up on election hopes; Argentine peso jumps

21 Sep 2018

By Bruno Federowski BRASILIA, Sept 21 Brazilian markets rose on Friday after an opinion poll suggested far-right lawmaker Jair Bolsonaro would do well against his main rival in a likely second-round vote in this year's presidential election. Bolsonaro has tapped University of Chicago-trained banker Paulo Guedes as his main economic advisor, driving investors to bet that he would act strongly to cut government spending and curb growth of public debt. Seeming contradictions between Guedes and Bolsonaro have raised questions over the lawmaker's commitment to a market-friendly reforms. Nevertheless, investors still prefer him over leftist Fernando Haddad, who seems most likely to reach the second round. A phone-based survey published by XP Investimentos showed Bolsonaro remains in the lead in the first round but technically tied with Haddad in the second round. Bolsonaro's rejection rate, however, was smaller than that of Haddad's, running contrary to other recent polls which have shown the opposite. Brazil's benchmark stock index jumped 2 percent, leading gains in the region as blue-chips such as Vale SA and Petróleo Brasileiro SA rose. The Brazilian real firmed 0.9 percent to 4.04 to the dollar - a one-month high - on a day when currencies from Mexico , Colombia and Chile were either flat or slightly higher. "The XP survey is making investors cheerful, but there is little room for the currency to appreciate past 4.05," Miriam Tavares, head of currency trading at AGK brokerage, said. The Argentine peso was the biggest gainer in Latin American currency markets, rising nearly 2 percent even as the central bank refrained from intervening. The peso has been driven higher this week by optimism that the government will sign a revised standby financing deal with the International Monetary Fund that will include stricter fiscal measures. Key Latin American stock indexes and currencies at 1720 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1036.93 0.57 -10.49 MSCI LatAm 2509.66 0.32 -11.26 Brazil Bovespa 79713.55 2.05 4.33 Mexico IPC 49696.75 0.38 0.69 Chile IPSA 5421.35 -0.46 -0.46 Argentina MerVal 34217.88 -0.86 13.81 Colombia IGBC 12265.06 0.48 7.87 Currencies daily % YTD % change change Latest Brazil real 4.0350 0.89 -17.89 Mexico peso 18.8126 0.03 4.71 Chile peso 664.1 0.47 -7.45 Colombia peso 3000.35 0.15 -0.61 Peru sol 3.289 0.21 -1.58 Argentina peso (interbank) 37.5500 1.86 -50.47 Argentina peso (parallel) 38.25 1.31 -49.73 (Reporting by Bruno Federowski; Additional reporting by Claudia Violante in São Paulo Editing by Alistair Bell)

Brazil holds interest rates, may hike if outlook worsens

19 Sep 2018

BRASILIA Brazil's central bank on Wednesday held interest rates at an all-time low but said it could gradually raise them if the outlook worsens, highlighting how the upcoming presidential vote is increasingly weighing on monetary policy.

EMERGING MARKETS-LatAm currencies up after latest U.S.-China trade tariffs

19 Sep 2018

(Updates prices) By Bruno Federowski BRASILIA, Sept 19 Latin American currencies on Wednesday firmed slightly as investors saw the latest round of U.S-China trade tariffs as less aggressive than expected, boosting appetite for risky assets. The Brazilian real strengthened 0.33 percent, and the Mexican peso firmed 0.10 percent. The tariffs "did not have the expected impact, and the market is now focused on the ongoing negotiations" between Canada and the United States, said Alfonso Esparza, an analyst at OANDA. Longer-than-expected negotiations to revamp the North American Free Trade Agreement (NAFTA) have weighed on the peso in recent months, but the currency has since recovered after the United States and Mexico reached a deal. The benchmark Mexican stock index was down 0.19 percent in afternoon trading, showing that investors remain attentive to the negotiations. The talks have stalled once again amid disagreement between Canadian and U.S. negotiators. U.S. Chamber of Commerce President Tom Donohue said on Wednesday that the Trump administration could still avoid a full-blown global trade war that erodes business confidence if it seals a trilateral NAFTA trade deal and makes progress on European trade issues in the coming weeks. The Brazilian real was up after initially weakening at the open. The currency has been battered recently by concerns over the presidential elections. A voter intention survey for next month's vote showed leftist Fernando Haddad gaining strength, raising concern among traders who see him as less likely to cut government spending and pursue structural reforms than far-right lawmaker Jair Bolsonaro, who has led polls. Bolsonaro and Haddad are in a technical tie in a likely second-round runoff vote. Latin American stock indexes and currencies at 19:53 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1031.58 1.16 -11.97 MSCI LatAm 2500.79 0 -11.58 Brazil Bovespa 77985.41 -0.42 2.07 Mexico IPC 49567.71 -0.19 0.43 Argentina MerVal 32990.48 2.75 9.73 Colombia IGBC 12331.93 -0.22 8.45 Currencies daily % YTD % change change Latest Brazil real 4.1276 0.33 -19.73 Mexico peso 18.7915 0.10 4.83 Peru sol 3.303 0.09 -2.00 Argentina peso (interbank) 39.3500 1.14 -52.73 Argentina peso (parallel) 38.5 3.25 -50.05 Chile peso 686.8 0.00 -10.51 Colombia peso 3027.45 -0.50 -1.50 (Reporting by Bruno Federowski; Additional reporting by Miguel Gutierrez and Julia Love in Mexico City; editing by Jonathan Oatis and Grant McCool)

EMERGING MARKETS-LatAm currencies up after latest U.S.-China trade tariffs

19 Sep 2018

By Bruno Federowski BRASILIA, Sept 19 Latin American currencies on Wednesday firmed as investors saw the latest round of U.S-China trade tariffs as less aggressive than expected, boosting appetite for risky assets. The Mexican peso strengthened 0.3 percent. The tariffs "did not have the expected impact, and the market is now focused on the ongoing negotiations" between Canada and the United States, said Alfonso Esparza, an analyst at OANDA. Longer-than-expected negotiations to revamp the North American Free Trade Agreement (NAFTA) have weighed on the peso in recent months, but the currency has since recovered after the United States and Mexico reached a deal. Disagreement between Canadian and U.S. negotiators mean talks once again hit a wall. U.S. Chamber of Commerce President Tom Donohue said on Wednesday that the Trump administration could still avoid a full-blown global trade war that erodes business confidence if it seals a trilateral NAFTA trade deal and makes progress on European trade issues in the coming weeks. The Brazilian real rose 0.5 percent after initially weakening at the open. The currency has been battered recently by concerns over the presidential elections. A voter intention survey for next month's vote showed leftist Fernando Haddad gaining strength, raising concern among traders who see him as less likely to cut government spending and pursue structural reforms than far-right lawmaker Jair Bolsonaro, who has led polls. Bolsonaro and Haddad are in a technical tie in a likely second-round runoff vote. Key Latin American stock indexes and currencies at 1720 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1019.74 0.33 -11.97 MSCI LatAm 2500.71 1.51 -11.58 Brazil Bovespa 78647.26 0.43 2.94 Mexico IPC 49747.53 0.17 0.80 Chile IPSA 5354.45 -0.16 -0.16 Argentina MerVal 32771.40 2.07 9.00 Colombia IGBC 12328.53 -0.25 8.42 Currencies daily % YTD % change change Latest Brazil real 4.1187 0.54 -19.55 Mexico peso 18.7600 0.25 5.01 Peru sol 3.301 0.15 -1.94 Argentina peso (interbank) 39.3700 1.09 -52.76 Argentina peso (parallel) 38.75 2.58 -50.37 (Reporting by Bruno Federowski; Additional reporting by Miguel Gutierrez in Mexico City; editing by Jonathan Oatis)

Brazil set to hold rates, may hint at upcoming hike

19 Sep 2018

BRASILIA, Sept 19 The Brazilian central bank is likely to keep interest rates at an all-time low on Wednesday, but may indicate that it will hike them soon as unpredictable presidential elections hammer the nation's currency to record lows.

EMERGING MARKETS-Election nerves weaken Brazil real; other LatAm currencies up

13 Sep 2018

By Bruno Federowski BRASILIA, Sept 13 Brazil's currency and main stock index fell on Thursday because of mounting concerns about this year's elections, with the real underperforming other Latin American currencies, which strengthened on weaker-than-expected U.S. inflation figures. The real slipped 1.3 percent, weighed by concerns that far-right presidential candidate Jair Bolsonaro, who was stabbed at a campaign event last week, may be unable to campaign even in a likely second-round vote. Bolsonaro, who successfully underwent emergency surgery overnight, has tapped a University of Chicago-trained banker as his main economic adviser. Though some investors believed he could gain ground after the incident as a result of a sympathy vote, a recent poll showed he would likely lose in the second round to most of his main rivals. Traders fear a leftist president would refrain from cutting government spending to curb debt, which they see as necessary to bring back Brazil's investment grade sovereign rating. Those concerns weighed down the Brazilian real on a day when currencies of Chile, Mexico and Colombia all rose more than 0.9 percent. The dollar fell to a near 1-1/2-month low against a group of other major currencies after data showed consumer prices in the United States increased less than expected in August, reducing traders' expectations of accelerating U.S. inflation. Weaker inflation could drive the Federal Reserve to hike rates more slowly, bolstering the demand for high-yielding, emerging-market assets. Risk appetite worldwide was also lifted by signs of reduced trade tensions between China and the United States after Washington reached out to Beijing on Wednesday to restart trade talks. Key Latin American stock indexes and currencies at 1945 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1017.85 1.32 -13.28 MSCI LatAm 2419.95 -0.29 -14.19 Brazil Bovespa 74550.62 -0.76 -2.42 Mexico IPC 49680.95 0.86 0.66 Argentina MerVal 30286.95 1.82 0.74 Colombia IGBC 12228.08 -0.84 7.54 Venezuela IBC 354704.53 5.93 27981. 17 Currencies daily % YTD % change change Latest Brazil real 4.1981 -1.28 -21.08 Mexico peso 18.8450 0.93 4.53 Chile peso 681.41 0.95 -9.80 Colombia peso 3015.8 0.93 -1.12 Peru sol 3.314 0.48 -2.32 Argentina peso (interbank) 39.5500 -2.65 -52.97 Argentina peso (parallel) 38.25 -0.65 -49.73 (Reporting by Bruno Federowski; Editing by Bernadette Baum)

EMERGING MARKETS-Brazil real underperforms on election jitters; LatAm currencies up

13 Sep 2018

By Bruno Federowski BRASILIA, Sept 13 The Brazilian real fell on Thursday due to mounting concerns around this year's elections, underperforming other Latin American currencies which strengthened after weaker-than-expected U.S. inflation figures. The real slipped 0.7 percent, weighed by concerns that far-right presidential candidate Jair Bolsonaro may be unable to campaign even in a likely second-round vote after he underwent a successful emergency surgery overnight. Bolsonaro, who was stabbed in a campaign event last week, has tapped a University of Chicago-trained banker as his main economic adviser. Though some investors believed he could gain ground after the incident due to a sympathy vote, a recent poll showed he would likely lose in the second round to most of his main rivals. Traders fear a leftist president would refrain from cutting government spending to curb debt, which they see as necessary to bringing back Brazil's investment grade sovereign rating. Those concerns weighed down the Brazilian real on a day when currencies from Chile, Mexico and Colombia rose between 0.7 and 1 percent. The dollar fell to a near 1-1/2-month low against a group of major currencies after data showed U.S. consumer prices increased less than expected in August, paring traders' outlook that domestic inflation is accelerating. Weaker inflation could drive the Federal Reserve to hike rates more slowly, bolstering the demand for high-yielding, emerging-market assets. Signs of reduced trade tensions between China and the United States after Washington reached out to Beijing on Wednesday to restart trade talks also lifted risk appetite worldwide. Key Latin American stock indexes and currencies at 1530 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1004.56 0.12 -13.28 MSCI LatAm 2426.89 2.01 -14.19 Brazil Bovespa 74664.70 -0.61 -2.27 Mexico IPC 49544.38 0.59 0.38 Chile IPSA 5327.20 1.23 1.23 Argentina MerVal 30120.55 1.26 0.18 Colombia IGBC 12325.56 -0.05 8.40 Currencies daily % YTD % change change Latest Brazil real 4.1733 -0.69 -20.61 Mexico peso 18.8816 0.70 4.33 Chile peso 681.1 1.00 -9.76 Colombia peso 3021.29 0.75 -1.30 Peru sol 3.325 0.15 -2.65 Argentina peso (interbank) 38.6800 -0.47 -51.91 Argentina peso (parallel) 37.75 0.66 -49.06 (Reporting by Bruno Federowski; Editing by Bernadette Baum)

EMERGING MARKETS-Brazil markets rebound on election poll, Latam stocks rise

12 Sep 2018

(Updates prices) By Bruno Federowski BRASILIA, Sept 12 Brazilian markets rebounded on Wednesday after a poll showed far-right presidential candidate Jair Bolsonaro slightly gaining strength in a second-round vote, driving bargain-hunting following a deep selloff. The benchmark Bovespa stock index rose almost 1 percent, led by blue chips such as oil company Petróleo Brasileiro SA, lender Banco Bradesco SA and power utility Centrais Elétricas Brasileiras SA. The Brazilian real firmed slightly after slipping 1.5 percent the day before. Bolsonaro, who was stabbed at a campaign event last week, has tapped a University of Chicago-trained banker as his main economic advisor. Investors had hoped Bolsonaro would benefit from a sympathy vote, reducing the likelihood that leftist rivals Fernando Haddad or Ciro Gomes would win this year's vote. Other markets in Latin America also edged up as investors took a breather from recent losses stemming from escalating trade tensions between the United States and other countries. Currencies from Mexico, Chile and Colombia firmed between 0.7 and 1.3 percent. Stock indexes across the region rose. Key Latin American stock indexes and currencies at 1955 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1006.51 0.32 -13.39 MSCI LatAm 2428.01 2.06 -15.88 Brazil Bovespa 75373.40 0.96 -1.35 Mexico IPC 49253.62 0.73 -0.20 Argentina MerVal 29760.12 2.05 -1.02 Colombia IGBC 12353.22 2.53 8.64 Venezuela IBC 334860.22 -0.79 26410.14 Currencies daily % YTD % change change Latest Brazil real 4.1491 0.10 -20.14 Mexico peso 19.0480 0.76 3.42 Chile peso 687.9 1.24 -10.65 Colombia peso 3043.95 1.18 -2.04 Peru sol 3.33 0.12 -2.79 Argentina peso (interbank) 38.2000 -0.63 -51.31 Argentina peso (parallel) 37.5 2.67 -48.72 (Reporting by Bruno Federowski and Christine Murray; Editing by Will Dunham and Phil Berlowitz)

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