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Shreyashi Sanyal

EMERGING MARKETS-Latam FX, stocks fall on U.S.-China, virus risks

4:06pm BST

By Shreyashi Sanyal July 16 Most stocks and currencies in Latin America declined on Thursday, as souring relations between the United States and China and surging cases of the COVID-19 drove investors out of riskier assets. Hurting sentiment further was data which showed unexpected weakness in China's domestic consumption, which underscored the need for more policy support to bolster the recovery. However, China's economy returned to growth in the second quarter after a deep slump at the start of the year. China is one of the biggest importers of agricultural products and metals from Latin America, with investors closely watching headlines about the country. Geopolitical risks were heightened after the White House said on Wednesday it had not ruled out further sanctions on top Chinese officials to punish China for its handling of Hong Kong. The United States also said it was studying the national security risks of social media applications including China's TikTok and WeChat. MSCI's index for Latin American stocks fell 1%, but was still on track for a weekly gain as investors were optimistic about signs of development of a coronavirus vaccine by Moderna Inc. Cases continued to surge in South America, with Mexico reporting 6,149 new confirmed coronavirus infections on Wednesday and 579 additional fatalities, bringing the total in the country to 317,635 cases and 36,906 deaths. Agricultural exports to China have also been impacted as Argentina suspended exports to China from eight meatpacking plants and the Chinese government asked Brazil to suspend exports from two meat plants over coronavirus concerns. The Mexican peso was rangebound on Thursday, with investors keeping a close watch on oil prices. In Brazil, Economy Minister Paulo Guedes said on Wednesday that his team is studying reducing taxes and encouraging informal workers to file tax returns by granting them up to a 20% bonus over their earnings, what he called a "negative tax." The real firmed against the dollar. Chilean markets were shut on Thursday due to a public holiday. On Wednesday, Chile's central bank kept its benchmark interest rate steady at 0.5% as per market expectations. Key Latin American stock indexes and currencies; Stock indexes Latest Daily % change MSCI Emerging Markets 1046.67 -1.84 MSCI LatAm 1988.06 -0.96 Brazil Bovespa 100758.09 -1.01 Mexico IPC 36381.19 -0.57 Chile IPSA 4041.62 -3.33 Argentina MerVal 44941.53 -0.397 Colombia COLCAP 1146.57 0.15 Currencies Latest Daily % change Brazil real 5.3405 0.79 Mexico peso 22.2859 0.16 Chile peso 781 0.00 Colombia peso 3624.15 -0.26 Peru sol 3.4948 -0.03 Argentina peso 71.4100 -0.07 (interbank) Argentina peso 124 2.42 (parallel) (Reporting by Shreyashi Sanyal in Bengaluru Editing by Alistair Bell)

EMERGING MARKETS-Stocks slip on U.S.-China worries, firm dollar hits FX

9:41am BST

July 16 Emerging market stocks fell to a one-week low on Thursday as tensions between the United States and China and rising coronavirus cases around the world weighed on investor sentiment, while a stronger dollar hit risky currencies.

EMERGING MARKETS-Brazil stocks at over 4-mth high; Chilean c.bank meeting awaited

15 Jul 2020

* Latam currencies make small moves against dollar * Chilean stocks fall * Latam set for deep recession, slow recovery (Adds background, updates prices) By Shreyashi Sanyal and Ambar Warrick July 15 Brazilian stocks hit a more than four-month high on Wednesday as signs of progress in developing a coronavirus vaccine invited more buying into risk-driven assets, even as COVID-19 cases piled. The Bovespa stock index rose about 1% to its highest level since early March, propped up by financial and energy stocks. Most Latin American bourses gained after Moderna Inc flagged positive data from its trials for a COVID-19 vaccine, while reports of potential positive news on initial trials of the University of Oxford's COVID-19 vaccine also helped. "Hope is sky high that a vaccine will be in place by the end of the year and that is driving the reopening trade again," Edward Moya, senior market analyst for the Americas at OANDA, wrote in a note. Chilean stocks bucked the trend, falling 3% on protests in support of a proposal to allow Chileans to withdraw part of their pensions during the COVID-19 crisis. The bill was approved by lawmakers, with a Senate vote to follow soon. Markets also awaited a central bank decision on its benchmark lending rate, which is expected to remain unchanged, after a series of successive cuts earlier in the year due to economic stress from the pandemic. "We expect the monetary policy committee to keep the policy rate at the 0.50% effective lower bound and continue to signal the maintenance of the current stance for a prolonged period," Goldman Sachs analysts wrote in a note. The Chilean peso edged up against the dollar, while most other currencies in the region marked small moves as optimism over a vaccine was undercut by a continued spike in coronavirus cases in the continent. A United Nations agency said in a report issued on Wednesday the pandemic will swell the ranks of the poor and unemployed in Latin America and the Caribbean and drag the region's economic output down by 9.1%. A Reuters poll also showed a historic recession in Latin America will likely drag on before Brazil, the region's No. 1 economy, starts fixing a dire budget shortfall that tops the list of threats along with the coronavirus pandemic. Currencies of oil exporters Mexico and Colombia edged higher on rising crude prices, even as geopolitical tensions between the United States and China flared. Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1064.43 0.46 MSCI LatAm 1989.72 1.87 Brazil Bovespa 101456.74 1.01 Mexico IPC 36627.11 1.21 Chile IPSA 4057.51 -2.95 Argentina MerVal 44928.45 2.106 Colombia COLCAP 1145.50 0.08 Currencies Latest Daily % change Brazil real 5.3760 -0.56 Mexico peso 22.3661 0.34 Chile peso 783.9 0.26 Colombia peso 3608.57 0.39 Peru sol 3.4937 0.12 Argentina peso 71.3500 -0.07 (interbank) (Reporting by Shreyashi Sanyal in Bengaluru Editing by Alistair Bell and Richard Chang)

EMERGING MARKETS-Latam stocks hit one-month high as vaccine hopes fuel risky bets

15 Jul 2020

By Shreyashi Sanyal July 15 A gauge for Latin American shares touched its highest level in one month on Wednesday as signs of progress in developing a coronavirus vaccine helped bring risk appetite back into the market, with currencies rising against a weaker dollar. MSCI's index for Latin American stocks jumped as much as 3.3%, on track for its best day since early June, while its index for currencies gained 1.7%. Markets were optimistic after Moderna Inc said on Tuesday, its experimental vaccine for COVID-19 was safe and provoked immune responses in all 45 healthy volunteers in an ongoing early-stage study. "Hopes that a COVID-19 vaccine may be inching closer to reality have fueled a solid rebound in risk appetite today. In line with this, the USD is weaker this morning against all G10 and most EM currencies," said Ned Rumpeltin, European head of FX strategy at TD Securities. Currencies of oil exporters Mexico and Colombia were higher on rising crude prices, even as geopolitical tensions flared. U.S. President Donald Trump ordered an end to Hong Kong's special status under U.S. law to punish China for what he called "oppressive actions" against the former British colony, prompting Beijing to warn of retaliatory sanctions. Brazil's real fell 0.3%, as investors remained cautious of the coronavirus spreading rapidly through the country and anticipated further cuts in the benchmark lending rate next month. Sao Paulo stocks jumped amid broader market optimism even as Vale SA fell 1.2% after a Brazilian court ruled that the miner must present 7.9 billion reais ($1.47 billion) in guarantees by July 23 related to last year's Brumadinho dam disaster. Chile's peso firmed against the dollar, with local investors closely tracking headlines around a bill moving through congress to allow citizens to withdraw 10% of their pensions in the country's Pension Fund Administrators (AFP) system. Chilean President Sebastian Pinera on Tuesday widened emergency support for middle-class citizens hit by the coronavirus-led economic shutdown to head off legislation that would allow withdrawals from the country's private pension funds. A Reuters poll showed a historic recession in Latin America will likely drag on before Brazil, the region's No. 1 economy, starts fixing a dire budget shortfall that tops the list of threats along with the persistent coronavirus pandemic. Key Latin American stock indexes and currencies; Stock indexes Latest Daily % change MSCI Emerging Markets 1065.26 0.54 MSCI LatAm 1989.64 1.86 Brazil Bovespa 101067.81 0.62 Mexico IPC 36595.06 1.12 Chile IPSA 4133.65 -1.13 Argentina MerVal 0.00 0 Colombia COLCAP 1146.02 0.13 Currencies Latest Daily % change Brazil real 5.3590 -0.24 Mexico peso 22.3374 0.47 Chile peso 786.7 -0.10 Colombia peso 3604.5 0.50 Peru sol 3.4948 0.09 Argentina peso 71.3500 -0.07 (interbank) Argentina peso (parallel) 123 3.25 (Reporting by Shreyashi Sanyal in Bengaluru Editing by Alistair Bell)

EMERGING MARKETS-Stocks bounce back on vaccine optimism; S.African rand leads gains

15 Jul 2020

July 15 Emerging market stocks bounced back on Wednesday on hopes of a coronavirus vaccine, while the high-yielding South African rand led gains among developing world currencies.

EMERGING MARKETS-Latam stocks gain; Brazil's real up on economic recovery hopes

14 Jul 2020

* Brazil stocks eye best close since early-March * Chilean peso flat as copper prices retreat * Mexican economic recovery to be slow- Analyst (Adds bullets, background; updates prices) By Shreyashi Sanyal and Ambar Warrick July 14 Brazil's real and its Latin American peers rose on Tuesday on improving economic data in the region's largest economy, although broader sentiment was constrained by increasing coronavirus cases. The real added 1%, bouncing back from session lows as data showed monthly economic activity in Brazil began to grow again in May, after two sharp consecutive declines in March and April. Brazil's Bovespa stock index also rose, eyeing its strongest close in more than four months on the back of material stocks. Iron ore miner Vale was among the biggest boosts to the Bovespa, tracking strength in prices of the commodity, which have been supported by hopes of increased demand from China. Mexico's peso rose 1.5% against the dollar. Recent data from the country have suggested that the worst is likely over but with limits on economic activity as the coronavirus spreads rapidly. "The government is sticking to its austerity course and is offering only little financial aid to the economy," Commerzbank analysts wrote in a client note. "Against this background, the economic recovery is likely to be very slow." Most currencies in the region have regained some lost ground from a steep sell-off in March, but high dollar demand and loosening monetary policy have kept them rangebound. Still, some commodity-linked currencies have outperformed in recent weeks on improving raw material prices. The Chilean peso was flat as copper prices fell on Tuesday, while oil-exporter Colombia's peso mirrored a dip in crude prices. Investors also awaited a policy statement from the Chilean central bank on Wednesday, which will likely show the benchmark interest rate remained at 0.5% in July. Risk appetite was sparse in global equity markets after a reintroduction of coronavirus restrictions in the U.S. state of California offset encouraging earnings reports from big banks on Wall Street. COVID-19 cases continued to spike in South America and other countries. A Reuters count on Monday showed that coronavirus-related deaths in Latin America had exceeded the figure for North America, for the first time since the start of the pandemic. Simmering U.S.-China tensions also hit sentiment after the Washington rejected Beijing's claims to offshore resources in most of the South China Sea. Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1060.17 -1.04 MSCI LatAm 1979.76 1.15 Brazil Bovespa 100232.47 1.56 Mexico IPC 36116.11 -0.75 Chile IPSA 4165.59 1.22 Argentina MerVal 43533.70 0.686 Colombia COLCAP 1144.20 -0.08 Currencies Latest Daily % change Brazil real 5.3352 0.97 Mexico peso 22.4330 1.46 Chile peso 787.7 0.15 Colombia peso 3622.49 -0.30 Peru sol 3.4978 -0.03 Argentina peso 71.2900 -0.07 (interbank) (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Richard Chang)

EMERGING MARKETS-Latam FX slides on coronavirus risks, U.S.-China tensions

14 Jul 2020

By Shreyashi Sanyal July 14 Most currencies in Latin America weakened on Tuesday, as a rise in COVID-19 cases globally and a flare-up in U.S.-China tensions kept investors away from riskier bets, even as data showed signs of economic improvement in Brazil. Risk appetite was sparse in global equity markets after a reintroduction of coronavirus restrictions in the U.S. state of California also took the shine off encouraging earnings reports from big banks on Wall Street. COVID-19 cases continued to spike in South America and elsewhere globally. A Reuters count on Monday showed the number of deaths from the coronavirus in Latin America had exceeded the figure for North America, for the first time since the start of the pandemic. Simmering geopolitical tensions between the United States and China also hit sentiment after the United States rejected China's claims to offshore resources in most of the South China Sea. The MSCI's index for Latin American currencies shed 1.2% while its stocks counterpart slipped 1.5%, putting both indexes on track for their worst one-day percentage fall in nearly three weeks. Brazil's real tumbled 0.7% against a firmer dollar, even as data showed economic activity in Latin America's largest economy began to grow again in monthly terms in May, after two sharp consecutive declines in March and April, as businesses slowly began to reopen. Most currencies in the regions have regained some lost ground from a steep sell-off, but higher dollar demand and loosening monetary policy have pressured Latin American currencies. But commodity-linked currencies have outperformed in recent weeks tracking some improvement in raw material prices. The Chilean peso tracked a decline in copper prices on Tuesday, while oil-exporter Colombia's peso mirrored a slide in crude prices. Investors also awaited a policy statement from the Chilean central bank on Wednesday, which will likely show the benchmark interest rate being held at 0.5% in July. Mexico's peso, however, rose 0.4% against the dollar. Analysts have said that recent economic data from the country has suggested that the worst is likely over but cautioned that economic activity remains limited as the virus is still spreading rapidly in the country. "The government is sticking to its austerity course and is offering only little financial aid to the economy," analysts at Commerzbank wrote in a client note. "Against this background, the economic recovery is likely to be very slow." Key Latin American stock indexes and currencies; Stock indexes Latest Daily % change MSCI Emerging 1055.46 -1.48 Markets MSCI LatAm 1927.21 -1.54 Brazil Bovespa 98552.04 -0.15 Mexico IPC 35982.93 -1.12 Chile IPSA 4104.49 -0.26 Argentina MerVal 43160.94 -0.176 Colombia COLCAP 1139.98 -0.45 Currencies Latest Daily % change Brazil real 5.4223 -0.65 Mexico peso 22.6130 0.66 Chile peso 787 0.24 Colombia peso 3641.22 -0.81 Peru sol 3.4998 -0.09 Argentina peso 71.2900 -0.07 (interbank) Argentina peso 123 3.25 (parallel) (Reporting by Shreyashi Sanyal in Bengaluru)

EMERGING MARKETS-Stocks falter on growth concerns as coronavirus cases rise

14 Jul 2020

July 14 Emerging markets stocks fell on Tuesday after COVID-19 cases continued to rise globally and economic growth forecasts were cut further, with currencies taking a hit from a firmer dollar as U.S.-China tensions flared.

EMERGING MARKETS-Latam FX weakens, stocks shrug off virus fears

13 Jul 2020

* Global COVID-19 cases surpass 13 million * Chilean central bank seen holding interest rates * Latam stocks rise along with broader markets (Adds details, updates prices) By Shreyashi Sanyal and Ambar Warrick July 13 Most currencies in Latin America started the week on the back foot amid increasing coronavirus cases in the region, while the Chilean peso rose ahead of a policy meeting later in the week. Brazil's real fell 0.6%, leading declines among regional peers while oil-linked currencies including the Mexican and Colombian pesos tracked weaker crude prices. Global coronavirus infections passed 13 million on Monday, according to a Reuters tally, which also shows the disease accelerating the fastest in Latin America. The Americas account for more than half the world's infections and half the deaths. While most Latin American currencies have regained some lost ground from a steep sell-off, heightened dollar demand and loosening monetary policy have pressured regional players. Still, commodity-linked currencies have outperformed in recent weeks on some improvement in raw material prices. Regional stocks rose on the day, tracking a rally in global equities as markets awaited the U.S. earnings season. Chile's peso firmed against the dollar, with attention shifting toward a policy meeting on Wednesday. Chile's central bank is expected to leave the benchmark interest rate at 0.5% in July and keep it there for nearly two years. Opposition lawmakers in Chile late last week pushed forward a constitutional reform to allow Chileans to withdraw as much as 10% from their pension funds amid the coronavirus crisis. "Chile's central bank is likely to keep rates steady with the next policy move expected to be a hike sometime closer to 2022," said Edward Moya, senior market analyst at OANDA in New York. "The focus with Chile has mainly been on the Chamber of Deputies approval to allow Chileans to tap their retirement savings. If the bill passes, this could drag down Chilean stocks, bonds and the peso." Santiago stocks rose 2.3%, with miners leading the charge as prices of copper, Chile's main export, touched their highest in more than two years. In Costa Rica, President Carlos Alvarado on Sunday said the nation will begin negotiations with the International Monetary Fund to access a financial aid package to help offset the economic blow from the COVID-19 pandemic. Argentine stocks rose the most in the region as markets continued to watch for fresh developments in the country's debt restructuring talks. Ecuador, which is also in the process of restructuring its sovereign debt, will have to sweeten its offer to creditors, analysts said. Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1074.35 0.48 MSCI LatAm 1971.68 0.03 Brazil Bovespa 100042.67 0.01 Mexico IPC 36351.37 -0.31 Chile IPSA 4124.64 2.34 Argentina MerVal 43913.55 2.728 Colombia COLCAP 1150.60 0.25 Currencies Latest Daily % change Brazil real 5.3571 -0.67 Mexico peso 22.5393 -0.43 Chile peso 786.9 0.70 Colombia peso 3619.24 -0.32 Peru sol 3.4968 0.14 Argentina peso 71.2300 -0.41 (interbank) (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Tom Brown)

EMERGING MARKETS-Latam FX weakens on virus worries, Chilean central bank meeting in focus

13 Jul 2020

* Global COVID-19 case surpass 13 million * Chilean central bank seen holding interest rates * Latam stocks rise along with broader markets By Shreyashi Sanyal July 13 Most currencies in Latin America started the week on the back foot on Monday, as coronavirus infections continued to rise around the world, while the Chilean peso edged higher ahead of a policy meeting later in the week. Brazil's real fell 0.6%, leading declines among regional peers while oil-linked currencies including the Mexican and Colombian pesos tracked lower oil prices. Global coronavirus infections passed 13 million on Monday, according to a Reuters tally, which also shows the disease accelerating the fastest in Latin America. The Americas account for more than half the world's infections and half the deaths. MSCI's index for Latin American currencies, has rebounded significantly from a selloff in April on the back of global stimulus, but analysts warn the boost could soon fade if the spread of the virus is not brought under control across the region. Chile's peso firmed against the dollar, with attention shifting towards a policy meeting on Wednesday. Chile's central bank is expected to leave the benchmark interest rate at 0.5% in July and keep it there for nearly two years. Opposition lawmakers in Chile late last week pushed forward a constitutional reform to allow Chileans to withdraw as much as 10% from their pension funds amid the coronavirus crisis. "Chile's central bank is likely to keep rates steady with the next policy move expected to be a hike sometime closer to 2022," said Edward Moya, senior market analyst at OANDA in New York. "The focus with Chile has mainly been on the Chamber of Deputies approval to allow Chileans to tap their retirement savings. If the bill passes, this could drag down Chilean stocks, bonds and the peso." Stocks in Latin America rose on Monday, taking cues from Wall Street as the U.S. earning season kicks off for the second quarter. Santiago stocks rose the most in the region with a 1.5% gain, with miners leading the charge as prices of copper, Chile's main export, touched their highest in more than two years. In Costa Rica, President Carlos Alvarado on Sunday said the nation will begin negotiations with the International Monetary Fund to access a financial aid package to help offset the economic blow from the COVID-19 pandemic. Key Latin American stock indexes and currencies; Stock indexes Latest Daily % change MSCI Emerging 1078.16 0.83 Markets MSCI LatAm 1977.87 0.35 Brazil Bovespa 100674.24 0.64 Mexico IPC 36444.33 -0.06 Chile IPSA 4092.37 1.54 Argentina MerVal 0.00 0 Colombia COLCAP 1149.07 0.11 Currencies Latest Daily % change Brazil real 5.3534 -0.60 Mexico peso 22.4813 -0.17 Chile peso 789.2 0.41 Colombia peso 3614.95 -0.21 Peru sol 3.5018 0.00 Argentina peso 71.2200 -0.39 (interbank) Argentina peso 123 3.25 (parallel) (Reporting by Shreyashi Sanyal in Bengaluru)

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