January 7, 2019 / 2:29 PM / 9 months ago

EMERGING MARKETS-Latam FX rises vs soft dollar, Brazil's Bovespa passes 92,000 mark

    By Aaron Saldanha
    Jan 7 (Reuters) - Latin American currencies firmed on Monday
against a weaker dollar while stocks in the region gained in
early trade on cautious hopes that resolution of some U.S.-China
trade issues is within reach.
    U.S. Federal Reserve Chairman Jerome Powell on Friday said
the Fed would be patient and flexible in policy decisions this
year, sparking a drop in the value of the dollar that continued
into Monday.
    "Friday's softening of the language by Powell is a market
positive, as it opens the door to an outright dovish Fed in the
Jan 30 meeting," Citigroup head of emerging market strategy Dirk
Willer and emerging markets FX strategist Kenneth Lam wrote in a
note.
    "But the Fed needs to follow up with dovish actions, in our
view." 
    Aiding risk sentiment were hopes among some investors that 
U.S. and Chinese officials would make progress this week in
drawing a line under their countries' damaging trade war.

    MSCI's index of Latin American currencies
was up 0.6 percent, while its index of the region's stocks   
 was up 1 percent and on course for its highest
close in over two months and a half months.
    Mexico's peso firmed 0.5 percent, while Brazil's real
 rose as much as 0.7 percent against the dollar.
    Brazil's Bovespa stocks index surged past the
92,000-point mark, gaining up to 0.8 percent to set the stage
for a sixth straight higher session.
    Gains on the benchmark were mainly driven by the financials
and materials sectors. Miner Vale SA added 1.5
percent. 
    State-run oil company Petroleo Brasileiro SA's common shares
 and preferred shares rose 1.3 percent and
1 percent, respectively, underpinned by a 2 percent rise in
global oil prices.
    Chilean stocks were on track to notch a near
two-month closing high while the country's peso firmed
0.5 percent.
    Copper, Chile's key export, held onto gains clocked
on Friday when top consumer China took steps to support its
economy.            
    
    
    Key Latin American stock indexes and currencies at 1340 GMT
    
 Stock indexes                           daily %
                             Latest       change
 MSCI Emerging Markets          977.30      1.28
                                        
 MSCI LatAm                    2765.22      0.99
                                        
 Brazil Bovespa               92407.07      0.62
                                        
 Mexico IPC                          -         -
                                        
 Chile IPSA                    5215.66      0.51
                                        
 Argentina MerVal                    -         -
                                        
                                                
 Currencies                              daily %
                                          change
                                Latest  
 Brazil real                    3.7024      0.30
                                        
 Mexico peso                   19.3200      0.52
                                        
 Chile peso                      677.7      0.60
                                        
 Peru sol                        3.345      0.00
                                        
 Argentina peso                37.3200      0.13
 (interbank)                            
                                        
 

 (Reporting by Aaron Saldanha in Bengaluru)
  
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