January 7, 2019 / 10:40 PM / 2 months ago

EMERGING MARKETS-Latam currencies mixed, Brazil stocks retreat from record highs

 (Adds market details throughout)
    By Agamoni Ghosh
    Jan 7 (Reuters) - Latin American currencies were mixed
against a soft dollar on Monday, while stocks barring Brazil's
Bovespa rose, on a day when global equities were buoyed on
optimism over the resumption of U.S.-China trade talks. 
    The dollar weakened, pressured by expectations the U.S.
Federal Reserve will either pause or halt its interest rate hike
cycle, propping up developing world currencies.
    While currencies such as the Mexican peso and the
Argentine peso took some benefit from the greenback's
fall, Brazil's real suffered heavy losses, declining for
the first time in four sessions. 
    "The moves in currencies today are slightly driven by local
factors but there is also some fear from what the Fed will
actually do with interest rates in the U.S. as Latam currencies
are much more sensitive to them than before," said Christian
Lawrence, Senior Market Strategist, LatAm FX, Rabobank.
    The Bovespa index fell, retreating from last week's
record highs as gains in the energy and financial sector were
not enough to counter losses in the other sectors. 
    Eletrobras and Brazil's biggest airline Gol
Linhas Aereas Inteligentes were amongst the biggest
decliners on the index. 
    Preferential shares of Petrobras climbed by 3.24
percent and ordinary by 1.58 percent, after a
Brazilian newspaper reported the government will pay $14 billion
to the company to settle a dispute about the so-called transfer
of rights area off the Brazilian coast.
    Brazil's Economy Ministry has however, denied the report,
telling Reuters in a statement that it was only one of several
proposals passed to the transition team of President Jair
Bolsonaro by his predecessor Michel Temer. 
    Chile's peso fell marginally after data showed that
the country's copper exports were down 13.6 percent in December
for the world's largest copper producer because of the
volatility in the U.S.-China trade war.
    Chile's benchmark index rose slightly with
gains from lithium producers Albemarle and SQM
as statistics showed Chile's exports of lithium  exceeded from
the previous year in December as demand for the key component in
electric vehicle batteries continues to rise. 
    Mexico's peso touched its best level since the end of
October last year, helped by an oil price rise of about 3
percent on Monday, while its benchmark index advanced to
close at its best level since the beginning of November 2018.
    Buenos Aires' main stock index climbed over 2
percent to reach its highest level since October 2018 with
robust gains from Banco Macro and aluminum company
Aluar Aluminio Argentino
    The Colombian stock markets were shut for a public holiday. 

    Latin American stock indexes and currencies at 2200 GMT
    
 Stock indexes                                  daily %
                             Latest              change
 MSCI Emerging Markets               977.96        1.35
                                             
 MSCI LatAm                         2748.78        0.39
                                             
 Brazil Bovespa                    91699.05       -0.15
                                             
 Mexico IPC                        42834.20        0.89
                                             
 Chile IPSA                         5190.06        0.02
                                             
 Argentina MerVal                  33010.54        2.19
                                             
 Colombia IGBC                            -           -
                                             
                                                       
 Currencies                                     daily %
                                     Latest      change
 Brazil real                         3.7351       -0.07
                                             
 Mexico peso                        19.3560        0.07
                                             
 Chile peso                           679.8        0.03
                                             
 Colombia peso                      3179.99        0.30
 Peru sol                             3.352       -0.20
                                             
 Argentina peso (interbank)         37.3000        0.19
                                             
 
    

 (Reporting by Agamoni Ghosh in Bengaluru; editing by Grant
McCool)
  
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