April 10, 2019 / 9:25 PM / 4 months ago

EMERGING MARKETS-Latam FX firms across the board after dovish Fed minutes

 (Recasts throughout, updates prices, adds market strategists'
quotes)
    By Aaron Saldanha
    April 10 (Reuters) - Latin America currencies firmed on
Wednesday against a tepid dollar after the release of minutes
from the U.S. Federal Reserve's March policy meeting supported
investors' expectations of a dovish Fed in 2019.
    The Fed is likely to leave interest rates untouched this
year given risks from a global slowdown and uncertainty over
trade policies, the minutes showed, providing a reprieve to
developing-world assets which fell in 2018 as returns on 
dollar-based investments rose.
    Policymakers commenting that the Fed's policy stance could
shift in either direction based on incoming data "arguably gave
a dovish tone to the minutes overall," Michael Hanson, TD
Securities' head of global macro strategy, wrote in a note.
    "The March FOMC minutes confirmed that a majority of Fed
officials did not see any change in policy this year, consistent
with the dot plot," Hanson wrote, referring to the depiction of
policymakers' expectation of borrowing costs in the future.
    Mexico's peso tacked on 0.6% in gains, while stocks
 lost 0.5%, hurt by materials and financials stocks.
    "The expectations of loose monetary conditions going forward
could be the main support for financial markets," wrote
strategists at Banorte in Mexico, in a note.
    Brazil's real firmed 0.7%, while Sao Paulo-traded
stocks dropped 0.4%, largely weighed down by losses
among the financials and materials sectors.
    State-run oil firm Petroleo Brasileiro SA (Petrobras) saw
its common shares and preferred shares
fall 0.6% and 1.3%, respectively.
    The preferred shares rose as much as 1.4% during the
session, with sources telling Reuters that Petrobras would sell
more pipelines after the recent success of its 90% divestiture
of TAG.
    Shares of miner Vale SA fell 1.1%. A report said
prosecutors are planning to file criminal charges against Vale
and its employees over the collapse of a mine-waste dam in
January that killed hundreds of people.
    Chile's peso rose 0.4%, matching the gain in the
price of copper, the country's top export. Stocks
 dipped 0.1%.    
    Argentina's peso firmed while its stocks index
 was an aberration to the general norm seen on most
bourses in the region. The MerVal rose 1.3%, supported by
materials and energy stocks.
    Colombia's peso firmed 0.3%, while equities
rose 0.4%. 
    Ecopetrol SA added 0.7%, aided by a 1.4% rise in
oil prices.
    
    Latin American stock indexes and currencies at 2058 GMT
    
 Stock indexes                                     daily %
                                       Latest       change
 MSCI Emerging Markets                   1096.05      0.24
 MSCI LatAm                              2839.88       0.2
 Brazil Bovespa                         95953.45     -0.35
 Mexico IPC                             44909.14     -0.54
 Chile IPSA                              5278.00     -0.07
 Argentina MerVal                       32154.54       1.3
 Colombia IGBC                          13290.00      0.35
                                                          
 Currencies                                        daily %
                                                    change
                                          Latest  
 Brazil real                              3.8243     -0.03
 Mexico peso                             18.8170      0.60
 Chile peso                                661.8      0.30
 Colombia peso                           3093.68      0.25
 Peru sol                                  3.294      0.00
 Argentina peso (interbank)              42.9800      1.00
                                                  
 

 (Reporting by Aaron Saldanha in Bengaluru; Editing by Richard
Chang)
  
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