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EMERGING MARKETS-Latam stock markets underpinned by risk-on sentiment; FX mixed

Wed, 11th Sep 2019 15:43

Sept 11 (Reuters) - Most Latin American stocks rose on Wednesday as the prospect of increased stimulus in major economies underpinned risk-on buying in emerging markets, with safe-haven plays such as gold and bonds taking a backseat.

MSCI's index of Latin American stocks added 1.5% to climb to a near one-month high, while currencies were mixed against a strong dollar.

Investors perceived a conciliatory move from China to exempt 16 types of U.S. products from additional retaliatory tariffs for a year as a positive step in the trade war between Washington and Beijing.

Comments from a senior White House adviser, however, played down expectations for the next round of talks, raising doubts on whether a trade deal would be agreed on this year.

Investors are looking forward to the European Central Bank's monetary policy meeting on Thursday, where officials are widely expected to trim interest rates and introduce a stimulus package to shore up economic growth.

Brazil's Bovespa index gained about 0.9%, with consumer discretionary stocks accounting for most gains after data showed retail sales in July marked their biggest rise so far this year.

Financial services provider B3 SA Brasil Bolsa Balcao rose 3% and was the biggest boost to the Bovespa, while apparel retailer Lojas Renner SA rose about 2%.

Stock indices in Mexico and Colombia gained between 0.3% and 0.4%.

Currencies in the region were more mixed, with Brazil's real gaining 0.4%, while Colombia's peso shed 0.3%.

Colombia is slated to take out nearly 19.2 trillion pesos ($5.7 billion) in new debt to finance next year's budget, Finance Minister Alberto Carrasquilla told Congress on Tuesday, without specifying whether the funds would come from bonds, loans or other sources.

The Chilean peso retreated more than 0.4% against the dollar, as the price of copper, the country's top export, continued to fall on weak demand for the metal.

The Mexican peso and the Colombian peso fell about 0.3% each. Both currencies had gained substantially over the last week, tracking robust oil prices.

Latin American stock indexes and currencies at 1417 GMT

 Stock indexes                                  Daily % change
 MSCI Emerging Markets                1017.19              0.9
 MSCI LatAm                           2699.56             1.48
 Brazil Bovespa                     104127.08             1.06
 Mexico IPC                          42689.13             0.24
 Chile IPSA                           4886.49             0.13
 Argentina MerVal                    28359.79           -0.255
 Colombia IGBC                       12810.14             0.43

 Currencies                                     daily % change

 Brazil real                           4.0626             0.80
 Mexico peso                          19.5493            -0.30

 Chile peso                             714.6            -0.42
 Colombia peso                        3369.75            -0.30
 Peru sol                              3.3468            -0.11
 Argentina peso (interbank)           56.0600            -0.02
(Reporting by Ambar Warrick in Bengaluru; Editing by Dan Grebler)

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