October 19, 2018 / 3:01 PM / a month ago

EMERGING MARKETS-Latam currencies firm as dollar steadies, stocks rise

    Oct 19 (Reuters) - After a punishing session on Thursday,
Latin American stocks rose on Friday, taking cues from Wall
Street's higher open, while currencies firmed as the dollar
steadied.
    A recovery in the euro from two-month lows hit on worries
over Rome's draft budget being rejected by the European Union
had the dollar retreating from highs hit in the previous
session.
    Wall Street was buoyed by strong earnings from blue chips,
encouraging bulls in the regional bourses, with Mexico's IPC
stock index and Brazil's Bovespa each rising more
than 0.8 percent. 
    Among currencies, Mexico's peso firmed after two
losing days, but was still on pace to clock its steepest weekly
loss in two months. 
    "Despite all the elements that generate a greater degree of
risk aversion, a bounce in the international price of petroleum
and a weakening dollar favors the peso," said analysts at CI
Banco in a note. 
    Oil prices rose on signs of surging demand in China, the
world's second-biggest oil consumer, helping net exporters of
oil such as Mexico.
    Brazil's real led gains among currencies, rising 0.6
percent as polls showed market-favored presidential candidate
Jair Bolsonaro all but set to clinch the country's top post as
he increased his lead against rival Fernando Haddad. 
    Markets seemed to shrug off an accusation by the opposition
that Bolsonaro sought funding from business leaders to purchase
mass WhatsApp messages, in an alleged campaign finance
violation.
    Investors also seemed unfazed by news that the country's
central bank chief, Ilan Goldfajn, would step down by the end of
the year.
    Earlier this month, after the first-round vote, newspaper
Folia de S. Paulo reported that Bolsonaro might the head of
global markets at Santander Brasil SA to lead the
central bank if Goldfajn declined to stay.
    The Argentine peso strengthened slightly and looked
set to post weekly gains of nearly 3 percent. 
    Argentina's efforts to curb a budget deficit, tame inflation
and restore confidence, however, would likely drag down its
economy for years to come, a Reuters poll showed, as it
struggles to break out of a decades-long cycle of financial
crises.
    The currency has shed almost half its value against the
dollar and is set to log its worst year ever. 
    
    Key Latin American stock indexes and currencies at 1417 GMT:
 Stock indexes                  Latest    Daily %      YTD %
                                           change     change
 MSCI Emerging Markets           973.94      0.31     -16.19
                                                   
 MSCI LatAm                     2714.11      0.62      -4.63
                                                   
 Brazil Bovespa                84532.63      0.82      10.64
 Mexico IPC                    47488.97      0.99      -3.78
 Chile IPSA                     5130.87      0.23       0.23
                                                   
 Argentina MerVal              28790.68      1.48      -4.24
                                                   
 Colombia IGBC                 12556.53      0.35      10.43
                                                   
                                                            
 Currencies                               Daily %      YTD %
                                           change     change
                                 Latest            
 Brazil real                     3.7013      0.60     -10.48
                                                   
 Mexico peso                    19.1226      0.14       3.01
                                                   
 Chile peso                       675.6      0.24      -9.02
                                                   
 Colombia peso                   3073.7      0.53      -2.98
 Peru sol                         3.328      0.18      -2.73
                                                   
 Argentina peso (interbank)     36.6000      0.14     -49.18
                                                   
 Argentina peso (parallel)        36.75      1.36     -47.67
                                                   
 

 (Reporting by Susan Mathew in Bengaluru; Editing by Dan
Grebler)
  
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