August 20, 2019 / 8:18 PM / a month ago

EMERGING MARKETS-Argentine stocks lag Latam markets, currencies rise

 (Adds details, updates prices)
    * Argentina stocks slump, peso rises on c.bank action 
    * Brazilian telecoms carrier Oi slides 12%
    * Investors brace for dovish Fed at Jackson Hole 

    By Agamoni Ghosh
    Aug 20 (Reuters) - A soft U.S. dollar helped most Latin
American currencies rise on Tuesday, as investors awaited
further guidance from central banks in the wake of global
slowdown fears, while Argentine stocks stood out for their
losses among its regional peers.       
    Argentina's Merval index that opened after an
extended weekend, sank 10% factoring in the news of ratings
agencies Fitch and Standard & Poor's downgrading the country's
sovereign debt rating following a shock primary
election.
    The peso which had shed over 1% in the early hours of
trading recovered to climb 0.5% after the central bank
intervened and poured $112 million of its reserves into dollar
auctions.
    The new treasury minister, Hernan Lacunza, further sought to
calm investors assuring the country will stand by its 2019
fiscal targets agreed with the International Monetary Fund, and
work to stabilize its currency. 
    President Mauricio Macri, who is struggling to revive his
campaign for a second term, is betting that the new treasury
chief can help stabilize the economy.
    "Potentially this new guy will be in office for only three
months so I don't think he'll be able to do much," said Edward
Glossop, Latin America economist at Capital Economics 
    "Its a job where he has his hands tied by the IMF framework
as Argentina has fiscal goals it needs to reach and Lacunza
doesn't have much discretion to loosen monetary policy."
    MSCI's index of Latin American stocks rose
0.2% with stocks in Mexico leading gains buoyed by hopes
of a resolution to a pivotal pipeline dispute by President
Andres Manuel Lopez Obrador.
    Sao Paulo-traded stocks rose only marginally, capped
by a near 12% slump in shares of Brazilian telecoms carrier Oi
 after reports that its largest shareholder is seeking
to replace Chief Executive Officer Eurico Teles.
    Currencies in the region rose across the board as dip in
U.S. treasury yields dented the dollar with investors bracing
for a potentially dovish Federal Reserve at a Jackson Hole,
Wyoming, gathering later this week.
    Colombia's peso and Chile's peso rose between
0.5% and 0.8%, while Brazil's real came off its
three-month lows. 
    
 Key Latin American stock indexes and currencies at 1930 GMT
 Stock indexes                                      daily %
                          Latest                     change
 MSCI Emerging Markets                980.92           0.33
                                              
 MSCI LatAm                          2585.69           0.21
                                              
 Brazil Bovespa                     99560.63           0.09
                                              
 Mexico IPC                         39677.66           0.31
                                              
 Chile IPSA                          4776.78          -0.21
                                              
 Argentina MerVal                   27281.49         -10.28
                                              
 Colombia IGBC                      12602.62            0.6
                                              
                                                           
 Currencies                                         daily %
                                      Latest         change
 Brazil real                          4.0415           0.62
                                              
 Mexico peso                         19.7417           0.57
                                              
 Chile peso                            708.3           0.71
                                              
 Colombia peso                       3405.23           0.83
 Peru sol                              3.382           0.12
                                              
 Argentina peso                      54.7100           0.53
 (interbank)                                  
                                              
 

 (Reporting by Agamoni Ghosh in Bengaluru; Additional reporting
by Tom Arnold; 
Editing by Sandra Maler)
  
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