January 22, 2020 / 3:20 PM / a month ago

EMERGING MARKETS-Brazil's real leads Latam FX higher as China virus scare eases

    * Brazil to start discussions on joining OPEC in July
    * China vows to tighten containment measures for virus
    * Argentine market braces as Buenos Aires deadline looms

    By Shreyashi Sanyal
    Jan 22 (Reuters) - Brazil's real led Latin American
currencies higher on Wednesday, as the country will start
discussions on joining the OPEC, and as investor risk appetite
grew due to China's attempts to contain a virus outbreak. 
    Brazilian energy minister Bento Albuquerque said Brazil will
start discussions on joining the Organization of the Petroleum
Exporting Countries during a visit to Saudi Arabia in July.
 
    Its currency strengthened 0.6% to 4.1858 against the
dollar, after two straight days of declines. 
    Sao Paulo stocks rose 0.7%, leading the major
regional markets. MSCI's index for Latin American equities
 rose 0.8%, a day after its biggest daily decline
in two months.
    A day earlier, risk aversion hit global financial markets on
concerns over a coronavirus outbreak in China. 
    Deaths from the virus in China rose to nine on Wednesday
with 470 confirmed cases but Beijing tightened containment
measures in hospitals.
    Analysts say fears of a repeat of the SARS virus outbreak in
2003 are unfounded, with countries better equipped to fight an
epidemic.
    "The spread of a new coronavirus across Asia and into the
U.S. is clearly a major public health concern, but we suspect
that its economic effects will be modest," said Jennifer
McKeown, head of global economics at Capital Economics.
    "Even the significant economic disruption related to SARS
turned out to be temporary and experts expect this disease to be
less deadly and better contained."
    Investors were watching the Argentine peso, hours
ahead of a deadline for creditors to green light or reject a
plan by the province of Buenos Aires to delay a $250 million
payment due on Jan. 26.
    Last year, the peso crashed due to concerns over politics in
Argentina and whether the country would repay its debt
obligations.
    The Mexican peso and the Chilean peso both
firmed against the dollar, while stock markets in the two
countries, remained mostly flat.     
    
    Key Latin American stock indexes and currencies at 1451 GMT
    
    Stock indexes             Latest    Daily % change
 MSCI Emerging Markets         1134.53           0.6815
                                        
 MSCI LatAm                    2901.24              0.8
                                        
 Brazil Bovespa              117855.86             0.71
                                        
 Mexico IPC                   45681.52              0.1
                                        
 Chile IPSA                    4689.27             -0.1
                                        
 Argentina MerVal             41677.75            0.463
                                        
 Colombia COLCAP               1655.56             0.13
                                        
                                                       
       Currencies             Latest    Daily % change
 Brazil real                    4.1870             0.44
                                        
 Mexico peso                   18.7010             0.33
                                        
 Chile peso                      771.9             0.17
                                        
 Colombia peso                  3335.1             0.55
 Peru sol                        3.314             0.09
                                        
 Argentina peso                60.1100            -0.02
 (interbank)                            
                                        
 
 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by David
Gregorio)
  
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