EMERGING MARKETS-Brazil stocks up as banks rise on rate hike outlook
* Interest rate futures yields rise on Mantega comments * Brazil's Bovespa up 0.26 pct, Mexico's IPC gains 0.11 pct By Asher Levine SAO PAULO, Feb 15 (Reuters) - Brazilian stocks rose on Friday as bets that the central bank would tighten monetary policy this year buoyed shares of banks, which usually make larger profits when interest rates are higher. Mexico's IPC index stemmed a four-day slide, however, while Chile's bourse was little changed. Brazil's Finance Minister Guido Mantega on Friday expressed concern about Brazil's inflation rate, fueling market bets that the central bank could raise interest rates this year. Interest rate futures rose sharply higher after Mantega's comments, with the contract maturing January 2014 jumping 12 basis points to 7.51 percent. Brazil's benchmark Bovespa stock index rose 0.26 percent to 58,228.96 points. Itaú Unibanco Holding SA, Brazil's largest non-government bank, added 3.45 percent, while rival Banco Bradesco gained 3 percent. Analysts cited more favorable conditions for banks under a higher interest rate scenario, in which they would gain more from holdings of interest-rate-linked government debt and face decreasing government pressure to reduce lending spreads. "Recent falls in banking shares were also overdone, so we are seeing some recovery today," said a broker who declined to be named because he is not authorized to speak on record. The index is on track to close the session with its fourth straight weekly loss and is down nearly 5 percent this year - compared with a nearly 7 percent gain in the S&P 500 index and a 7.5 percent gain in London's FTSE 100 index . "Monetary policy hasn't brought results, inflation is rising, the government is trying to solve it with interventions in some sectors, and all that is pushing investors away," said Joao Pedro Brugger, an analyst with Leme Investimentos in Florianopolis, Brazil. Mexico's IPC index rose for the first day in five, adding 0.11 percent to 43,927.30. Telecommunications firm America Movil, controlled by billionaire Carlos Slim, rose 0.4 percent, contributing most to the index's gains, while lender Grupo Financiero Banorte added 0.8 percent. Mexican economic growth likely increased in the fourth quarter as healthy internal demand picked up the slack from cooling exports, according to a Reuters poll. Chile's IPSA index was little changed from Thursday's close, with a 0.88 percent loss by retailer Falabella offsetting a 0.7 percent gain in conglomerate AntarChile. Latin America's key stock indexes at 1458 GMT: Stock indexes daily % YTD % Latest change change MSCI LatAm 3,885.97 0.26 2.05 Brazil Bovespa 58,228.96 0.26 -4.47 Mexico IPC 43,927.30 0.11 0.51 Chile IPSA 4,606.75 -0.07 7.10 Chile IGPA 22,393.63 -0.04 6.28 Argentina MerVal 3,305.00 0.03 15.79 Colombia IGBC 14,998.58 -0.26 1.92 Peru IGRA 21,299.46 -0.45 3.25 Venezuela IBC 579,485.94 -1.65 22.92
DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.