July 6, 2020 / 2:28 PM / a month ago

EMERGING MARKETS-Brazil, Chilean stocks at 4-month highs on China optimism

    * Colombian peso at near 1-month high
    * Chile's peso supported by copper prices
    * Argentine risk index falls after new bond plan

    By Ambar Warrick
    July 6 (Reuters) - Latin American currencies and stocks
strengthened on Monday as  strong economic data through last
week spurred sustained bets on a swift post-coronavirus
    Risk appetite was bolstered by a rally in Chinese equities
and the yuan, with the latter touching a 3-1/2 month
peak amid improving economic readings in the world's
second-largest economy. 
    Chile's peso was among the best-performing currencies
in the region, as the prices of copper, the country's largest
export, surged on the prospect of improving Chinese demand.

    Copper prices had also risen on concerns over disruptions to
Chilean supply by the COVID-19 pandemic.
    "With LatAm becoming the global epicenter for Covid-19
cases, the supply narrative has grown louder of late, as the
market recognizes that multinational miners may continue to
enforce social distancing practices that could hamper current or
future output until the contagion is clearly remedied," analysts
at TD Securities wrote in a note.
    Chilean stocks rose 2.3% to a four-month high,
outperforming regional peers, while the MSCI's index of Latam
equities added more than 2%.
    Chilean President Sebastian Pinera on Sunday announced a
$1.5 billion package of measures to help keep the country´s
ailing middle class afloat as the coronavirus pandemic continues
to ravage the economy.
    Economic recovery in China also stands to benefit Latin
American markets, given their large agriculture and basic
resources exports to the country.
    Oil-sensitive currencies of Mexico and Colombia
 extended gains from the prior week, underpinned by recent
strength in the crude market. Colombia's peso was near a
one-month high, while the Mexican peso scaled a more-than
two-week peak.
    Brazil's real rose 0.2%, while Brazilian stocks added
about 2%, touching their highest level since early March. 
    Still, spiking coronavirus cases across Latin America
prompted some caution, with the number only set to grow as
economies in the region slowly scale back lockdown measures.
    Argentina's peso was muted. The country's risk index
fell after the government unveiled an improved debt
restructuring offer to creditors.
    Argentina set a deadline of August 4 for creditors to accept
the new deal, which increases coupons and includes a bond to
account for accrued interest on the treasuries covered by the
    Argentine risk assets had lagged over the past week due to
uncertainty surrounding any deal.
    Key Latin American stock indexes and currencies:
    Stock indexes             Latest      Daily % change
 MSCI Emerging Markets         1060.69                2.67
 MSCI LatAm                    1997.88                2.35
 Brazil Bovespa               98733.23                2.03
 Mexico IPC                   38053.51                0.27
 Chile IPSA                    4297.95                2.28
 Argentina MerVal                    -                   -
 Colombia COLCAP               1132.65                0.66
       Currencies             Latest      Daily % change
 Brazil real                    5.3056                0.22
 Mexico peso                   22.2475                0.65
 Chile peso                      797.4                0.63
 Colombia peso                 3625.93                0.50
 Peru sol                       3.5348                0.11
 Argentina peso                70.8100               -0.24

 (Reporting by Ambar Warrick in Bengaluru; Editing by Dan
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