March 15, 2019 / 2:58 PM / a year ago

EMERGING MARKETS-Latam stocks rise on U.S.-China trade optimism, FX firms

    By Aaron Saldanha
    March 15 (Reuters) - Latin American stock markets rose along
with global peers on Friday, helped by optimism on the
U.S.-China trade front, while currencies in Latin America firmed
against a dollar softened by weaker than expected U.S. data.
    Risk appetite was boosted after a Xinhua report said
officials from the United States and China, a key destination
for Latin American resources exports, made substantive progress
on trade.     
    The dollar weakened as data showed U.S. manufacturing output
fell in February, underscoring the Federal Reserve's "patient"
stance towards interest rate increases this year.
    MSCI's index of Latin American stocks rose
0.7 percent, while its Latin American currencies index
 gained 0.1 percent.
    The show-stealer among currencies was Argentina's peso
, which firmed about 1.8 percent to its strongest level in
more than a week, after the local central bank announced
measures the day before aimed at tightening monetary policy.

     Dirk Willer, Citi Research's head of emerging market
strategy, and Kenneth Lam, emerging markets FX strategist, said
in a note that the central bank's stricter measures and the
finance ministry's sales of dollars confirmed on Thursday
support their view the USD/ARS currency pair will fall towards
the currency floor.
    Argentinean equities rose 0.7 percent. Those in
neighboring Brazil tacked on 0.5 percent, as gains
across most sectors outweighed losses among materials and energy
    Common and preferred shares of
state-run oil giant Petroleo Brasileiro SA (Petrobras) managed
to withstand pressure from lower oil prices as they eked
out modest gains.
    Petrobras shares were supported by comments from its chief
executive, Roberto Castello Branco, who said he believes the
firm will have divested about $10 billion in assets in the first
four months of 2019.
    The CEO of Caixa said the lender would sell its Petrobras
    Brazilian stocks on the whole have enjoyed a strong week and
are on course to end at its highest weekly closing level on
    Mexican stocks rose half a percent, as did the
country's peso, which is seen by some investors as a
weather vane of trade sentiment.
    Stocks in Chile rose 0.3 percent, as did the
country's peso, which was supported by firm prices of top
Chilean export copper.        
    Colombia's peso firmed for a fourth straight day and
was on course for its best closing level in more than a week,
while local stocks rose 0.3 percent.    
    Key Latin American stock indexes and currencies at 1413 GMT
 Stock indexes                                    daily %
                                      Latest       change
 MSCI Emerging Markets                  1056.99      0.84
 MSCI LatAm                             2840.11      0.73
 Brazil Bovespa                        99127.79      0.53
 Mexico IPC                            41979.04      0.48
 Chile IPSA                             5318.97      0.34
 Argentina MerVal                      33777.13      0.74
 Colombia IGBC                         12870.44      0.26
 Currencies                                       daily %
 Brazil real                             3.8310      0.42
 Mexico peso                            19.2280      0.47
 Chile peso                               669.3      0.27
 Colombia peso                          3121.28      0.62
 Peru sol                                 3.297      0.03
 Argentina peso (interbank)             39.9500      2.08
 (Reporting by Aaron Saldanha in Bengaluru
Editing by Phil Berlowitz)
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