January 5, 2018 / 9:37 PM / 6 months ago

EMERGING MARKETS-Brazil, Chile stocks hit record highs, Mexico peso gains

 (New throughout, adds gains in Brazil, Chile stocks; outlook on
currencies)
    By Flavia Bohone and Sheky Espejo
    SAO PAULO, Jan 5 (Reuters) - Brazilian and Chilean stocks
hit record highs on Friday, boosted by solid economic growth
data, while Mexico's peso firmed to its strongest level in more
than two weeks.
    Chilean equities were lifted by data that showed the economy
grew at its fastest pace in almost two years, while Brazil's
main stock index hit a record high after data showed
industrial production rose for the third month in row.
    Demand for Brazilian stocks has been fed so far this year by
the view that leftist ex-president Luiz Inacio Lula da Silva
could be convicted at the end of January in a corruption trial,
which may dim chances for the left to win in elections this
year.
    A Reuters poll on Friday found the Brazilian currency would
likely lose ground this year amid uncertainty over whether
President Michel Temer's structural reforms will survive the
most wide-open election in decades.
    Meanwhile, the Mexican peso was seen losing ground in the
first half of the year as traders hedge against a potential
victory by a leftist frontrunner.
    Mexico's peso led gains for the region's currencies on
Friday, capping a week where it advanced about 2.5 percent
against the dollar. 
    The peso has been helped by bets that the country's central
bank could hike interest rates again, with inflation close to a
16-year high. 
    However, analysts warned the currency would struggle to gain
much more ground amid fears that U.S. President Donald Trump
could pull out of a free-trade deal with Mexico. 
    The next set of talks between Mexico, the United States and
Canada on the future of the North American Free Trade Agreement
(NAFTA) are set for later this month in Montreal. 
    
    Key Latin American stock indexes and currencies at 2025 GMT:
    
 Stock indexes                              daily %    YTD %
                                   Latest    change   change
 MSCI Emerging Markets             1201.53     0.75     2.94
                                                     
 MSCI LatAm                        2972.61     0.46     4.63
 Brazil Bovespa                   79071.47     0.54     3.49
 Mexico IPC                       49770.78     0.05     0.84
 Chile IPSA                        5695.43     1.07     2.35
 Chile IGPA                       28636.41     1.09     2.34
 Argentina MerVal                 32205.59     0.79     7.12
 Colombia IGBC                    11781.61     0.49     3.61
 Venezuela IBC                     1263.67        0     0.04
                                                            
 Currencies                                 daily %    YTD %
                                             change   change
                                    Latest           
 Brazil real                        3.2291     0.10     2.61
                                                     
 Mexico peso                       19.1850     0.45     2.68
                                                     
 Chile peso                          605.8    -0.15     1.46
 Colombia peso                      2905.3    -0.66     2.64
 Peru sol                            3.212    -0.09     0.78
                                                     
 Argentina peso (interbank)        18.8600    -1.22    -1.38
                                                     
 Argentina peso (parallel)            19.4     0.05    -0.88
                                                     
 
    
 (Writing by Michael O'Boyle; Editing by David Gregorio)
  
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