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Sagarika Jaisinghani

EMERGING MARKETS-Brazil's real rebounds from record low; virus scare keeps stocks on edge

14 Feb 2020

* Real firms over 1% as central bank sells dollars * Brazilian equities fall on caution around coronavirus * Other Latam currencies mixed (New throughout, updates prices, market activity and comments to close) By Sruthi Shankar and Sagarika Jaisinghani Feb 14 Brazil's real rose on Friday and recorded its first weekly gain in seven, supported by the central bank's move to stem a selloff in the currency, while other Latin American assets came under pressure from concerns around the coronavirus epidemic. The real firmed 1.26%, its biggest daily gain in two months, a day after as the central bank sold $1 billion in foreign exchange swaps in its first market intervention in almost three months. Data showed economic activity in Brazil fell more than expected in December, tying in with other indicators that pointed to a slowdown in Latin America's largest economy at the end of last year. The real, which was also battered in 2019 by failed oil auctions, has already lost more than 6% this year and is among the worst performing regional currencies against the dollar. "In the short-term, it (the intervention) can certainly help the BRL, but it's hard to see a sustainable rally from the intervention alone," said Gordon Bowers, emerging markets fixed income analyst at Columbia Threadneedle. "For the currency to outperform, we need growth data to pick up." The epidemic has prompted economists to cut growth forecasts for China's GDP in the first quarter and sparked a flight from assets in Brazil, among the main iron ore exporters to China. Brazilian equities fell 1.1% on Friday, sliding for the second straight session. Health authorities reported about 5,000 new cases of the deadly virus on Friday, dashing earlier hopes that the outbreak was peaking. But global stock markets inched higher as policymakers pledged more monetary stimulus to limit its economic fallout. The Mexican peso added about 0.2%, a day after Mexico's central bank cut its benchmark interest rate for a fifth consecutive time in the wake of a stagnating economy and slightly above-target headline inflation. Colombia's peso slid 0.5%, while the Chilean peso edged higher. Key Latin American stock indexes and currencies at 2113 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1105.94 -0.01 MSCI LatAm 2789.91 -0.13 Brazil Bovespa 114378.62 -1.11 Mexico IPC 44993.62 -0.03 Chile IPSA 4655.86 -0.08 Argentina MerVal 38647.68 -0.056 Colombia COLCAP 1664.40 0.08 Currencies Latest Daily % change Brazil real 4.2934 1.31 Mexico peso 18.5468 0.23 Chile peso 790.8 0.57 Colombia peso 3390.61 -0.49 Peru sol 3.378 0.18 Argentina peso (interbank) 61.4575 -0.11 (Reporting by Sruthi Shankar and Sagarika Jaisinghani in Bengaluru; Editing by David Gregorio)

EMERGING MARKETS-Brazil's real rebounds from record low; virus scare keeps stocks on edge

14 Feb 2020

* Real firms over 1% as central bank sells dollars * Brazilian equities fall on caution around coronavirus * Mexican peso firms a day after interest rate cut * Chilean equities track copper prices lower By Sagarika Jaisinghani and Susan Mathew Feb 14 Brazil's real bounced back from record lows on Friday after the central bank intervened for the first time since November, but equities in the country were pressured by caution around the coronavirus epidemic. The real firmed 1% and was on track for its best day in two months, as the central bank sold $1 billion in foreign exchange swaps on Thursday. The currency was also set to break a six-week losing streak that was fueled by tepid economic growth. Fresh data on Friday showed economic activity in Brazil fell more than expected in December, tying in with other indicators that pointed to a slowdown in Latin America's largest economy at the end of last year. The real, which was also battered in 2019 by failed oil auctions, has already lost more than 6% this year and is among the worst performing regional currencies against the dollar. "The current situation is supportive of a weaker real because recent activity data has also disappointed," said Wilson Ferrarezi, an economist at TS Lombard in Sao Paulo. "However, the perception is that if the coronavirus situation improves, this could alleviate pressure on Brazilian markets." The epidemic has prompted economists to cut growth forecasts for China's GDP in the first quarter and sparked a flight from assets in Brazil, which is among the main iron ore exporters to China. Brazilian equities fell 0.2% on Friday, sliding for the second straight session. Health authorities reported about 5,000 new cases of the deadly virus on Friday, dashing earlier indications that the outbreak was peaking. But global stock markets inched higher as policymakers pledged more monetary stimulus to limit its economic fallout. A basket of Latin American currencies was up 0.4% and was on course for its fourth straight day of gains, while its counterpart tracking equities rose 0.3%. The Mexican peso added about 0.1%, a day after Mexico's central bank cut its benchmark interest rate for a fifth consecutive time in the wake of a stagnating economy and slightly above-target headline inflation. Chile's peso rose 0.4% but the equity index fell about 0.1%, tracking copper prices. The country is the biggest exporter of the red metal. Key Latin American stock indexes and currencies at 1420 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1107.65 0.14 MSCI LatAm 2801.67 0.29 Brazil Bovespa 115422.57 -0.21 Mexico IPC - - Chile SPIPSA 4654.90 -0.11 Argentina MerVal 38859.60 0.492 Colombia Colcap - - Currencies Latest Daily % change Brazil real 4.3043 0.71 Mexico peso 18.5891 0.00 Chile peso 790.4 0.62 Colombia peso 3369.15 0.14 Peru sol 3.3788 0.15 Argentina peso (interbank) - - (Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Steve Orlofsky)

EMERGING MARKETS-EM stocks inch up as virus scare raises stimulus hopes

14 Feb 2020

Feb 14 Emerging market stocks ticked higher on Friday on expectations of further monetary stimulus to mitigate the impact of the coronavirus epidemic on the global economy, while regional currencies largely shrugged off a raft of weak economic data.

EMERGING MARKETS-EM stocks gain as drop in new virus cases boosts confidence

12 Feb 2020

Feb 12 Emerging market stocks rose for the second straight session on Wednesday, as a drop in new coronavirus cases raised hopes that the fallout of the epidemic on the world's second biggest economy might not be as bad as previously feared.

EMERGING MARKETS-Stocks falter as coronavirus death toll mounts

07 Feb 2020

Feb 7 Emerging-market stocks slipped on Friday as the mounting death toll from the coronavirus epidemic overshadowed efforts by China to limit the economic fallout of the outbreak, while the Russian rouble eased ahead of a central bank meeting later in the day.

EMERGING MARKETS-Brazil leads Latam assets lower as China epidemic fans growth fears

31 Jan 2020

* Brazil stocks fall over 1%, real hits record low * WHO declares coronavirus global health emergency * China's measures to contain virus will be effective - analyst * Chilean stocks gain on upbeat economic data By Sagarika Jaisinghani and Ambar Warrick Jan 31 Brazilian equities shed over 1% on Friday, while the real hit a new record low, as investors grew anxious about economic growth after the China coronavirus outbreak was declared a global health emergency. A basket of Latin American stocks was down 1.6%, eyeing its biggest weekly decline in over five months, while its counterpart tracking regional currencies was off about 0.2%. The coronavirus epidemic, which first emerged in China's Hubei province, has now spread to 23 countries and has claimed over 200 lives, prompting travel restrictions from the United States and other countries. Although the World Health Organization declared the virus a global emergency on Thursday, it opposed restrictions on travel and trade with China and praised Beijing's efforts to contain the outbreak. "We believe China's aggressive measures to contain the virus will ultimately prove effective," said Mark Haefele, chief investment officer at UBS Global Wealth Management. "In our base case, we expect the outbreak of the virus not to cause a global economic slowdown and as such risk assets should stay well supported over the next six months." Still, risk appetite was dented on Friday after several businesses said they were facing supply problems because of the virus, with the travel, tourism and retail sectors being hit particularly hard. The Brazilian stock index was on course for its first monthly decline in five, also pressured by sluggish economic growth. The real, which has eased for three days in a row, hit an all-time low of 4.2791 to the dollar. "The main sign that (the real) could be oversold is a strong devaluation since the coronavirus outbreak," said Wilson Ferrarezi, economist at TS Lombard in Sao Paulo. The Brazilian central bank cut interest rates aggressively last year in order to kick-start the economy. A new Reuters poll on Friday showed economists expected the bank to cut rates again when it meets next week. Predictions of the rate cut were also making Brazil's currency less attractive for a carry trade, Ferrarezi added. The Chilean peso, which is sensitive to fluctuations in copper, eased 0.2% as prices of the red metal remained near five-month lows on worries about demand from its top consumer, China. In a bright spot, Chilean equities added about 0.4%, as data showed manufacturing production rose for a second straight month in December, bucking dire predictions of a slump in output following nearly two months of protests. The Argentinian MerVal was down about 0.4%, while Colombian equities fell 0.2%. Key Latin American stock indexes and currencies at 1515 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1060.99 -1.1 MSCI LatAm 2757.73 -1.55 Brazil Bovespa 113543.46 -1.72 Mexico IPC 44464.10 -0.89 Chile IPSA 4570.81 0.44 Argentina MerVal 40243.85 -0.374 Colombia COLCAP 1635.39 -0.17 Currencies Latest Daily % change Brazil real 4.2734 -0.37 Mexico peso 18.8850 -0.60 Chile peso 797.9 -0.20 Colombia peso 3422.21 -0.39 Peru sol 3.3758 -0.32 Argentina peso 60.3200 -0.11 (interbank) (Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Andrea Ricci)

EMERGING MARKETS-EM stocks log dour week as China epidemic dents growth optimism

31 Jan 2020

Jan 31 Emerging market stocks fell for the seventh straight session on Friday, with optimism around faster global growth fading as the World Health Organization declared a global emergency in the wake of the deadly coronavirus outbreak in China.

EMERGING MARKETS-EM stocks drop for fifth straight day as coronavirus fears linger

29 Jan 2020

Jan 29 Emerging market stocks fell on Wednesday, on track for their longest losing streak since August 2019, as the rising death toll from the coronavirus outbreak fanned fears of an economic slowdown in the world's second-biggest economy.

European shares inch lower as data-heavy week looms

20 Jan 2020

European shares retreated from recent peaks on Monday as investors paused before launching into a week packed with economic data and the European Central Bank's first policy meeting of the year. | Video

EMERGING MARKETS-Chilean peso leads Latam FX higher on strong China data

17 Jan 2020

* Chile's peso gains on higher copper prices * Latin American FX index climbs after two days of declines * Brazilian miner Vale hits over one-year high * Mexican peso, Peruvian sol, Colombian peso firm By Sagarika Jaisinghani and Ambar Warrick Jan 17 Gains in the Chilean peso lifted Latin American currencies on Friday, as stronger-than-expected economic data from China added to optimism about faster global growth in the wake of a Sino-U.S. trade truce. Chile's peso was on track for its best day in more than a week as a surprise acceleration in Chinese industrial output sent copper prices near an eight-month high. Chile is the world's top producer of the red metal. The currency is also set to end the week higher, after declining in the past two weeks on caution over anti-government protests last year. "The (Chilean peso), relative to the rest of the region, has really underperformed so we do see it coming back," said James Barrineau, head of emerging market debt at asset manager Schroders. "Stable growth in China is certainly very important for Chile. The peso almost trades like an Asian currency rather than a Latin American currency, in terms of its correlation to Asian fundamentals and China growth." An index of Latin American currencies was up 0.1% after declining for two straight sessions. Still, the basket was set for its biggest weekly drop in over two months, pressured by a fall in one of its biggest constituents: the Brazilian real. The real, which firmed about 0.3% on Friday, has lagged its regional peers since last year on economic instability in the country, which prompted the central bank to trim interest rates four consecutive times in 2019. Latest data from Latin America's biggest economy showed a slight pickup in economic activity for November, confirming earlier indications of an improvement in GDP heading into 2020, and sparking hopes of a moderate increase in the real later this year. Brazilian equities rose about 1%, powered by a 2.4% gain for Vale SA. The miner said on Thursday it had halted tailings operations at its Esperança mine to potentially carry out work to improve safety at the site, sending the benchmark Dalian iron ore futures higher. The Mexican peso was up 0.2%, while the Peruvian sol and Colombian peso added 0.1% and 0.3%, respectively. Key Latin American stock indexes and currencies at 1450 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1145.75 0.45 MSCI LatAm 2909.73 0.82 Brazil Bovespa 117825.75 0.96 Mexico IPC - - Chile SPIPSA 4880.49 -0.27 Argentina MerVal 42707.59 0.815 Colombia Colcap 1648.99 0.07 Currencies Latest Daily % change Brazil real 4.1779 0.27 Mexico peso 18.7405 0.17 Chile peso 772.3 0.41 Colombia peso 3311.31 0.29 Peru sol 3.3198 0.07 Argentina peso (interbank) 60.0250 -0.07 (Reporting by Sagarika Jaisinghani in Bengaluru Editing by Nick Zieminski)

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