EMERGING MARKETS-Brazil stocks drop on euro zone data, Cyprus
* Euro zone PMI data worse than expected in March * Bovespa at lowest level since mid November * Brazil Bovespa falls 0.36 pct, Mexico IPC down 0.34 pct By Asher Levine and Danielle Assalve SAO PAULO, March 21 (Reuters) - Brazilian stocks touched their lowest intraday level of the year on Thursday as concern over global economic growth drove down shares of banks, steelmakers and commodities exporters. Broadcaster Grupo Televisa drove losses on Mexico's IPC index, while Chile's bourse capped a two-day winning streak. Shares tracked global markets lower after Markit's Flash Eurozone Composite Purchasing Managers' Index (PMI) showed economic growth in the euro zone contracted more than expected in March. "With the exception of the United States, which has had a substantial economic improvement, the data has been coming in quite poorly in other places," said Marcello Paixao, a partner with Principia Capital Management in Sao Paulo. Concerns over global economic growth tend to lead investors away from riskier Latin American assets in favor of safe-haven investments such as the U.S. dollar. Adding to investor jitters, the European Central Bank on Thursday gave Cyprus a Monday deadline to raise billions of euros in order to receive a critical bailout and avoid a banking sector collapse. The global risk-off attitude led to a 0.36 percent decline in Brazil's benchmark Bovespa stock index, which has fallen in seven of the last eight sessions. Shares of the most widely traded stocks, which tend to attract a large proportion of foreign investors and often track global risk appetite, contributed most to the Bovespa's drop. Shares of Vale SA fell 0.75 percent, despite data that showed an improved economic growth outlook for China, the iron-ore miner's biggest customer. Shares of steelmaker Usinas Siderurgicas de Minas Gerais SA , known as Usiminas, fell 2.6 percent, while Banco Bradesco SA slipped 0.8 percent. The Bovespa is currently at its lowest level since mid-November, and has lost nearly 9 percent this year alone. "We have the combination of corporate earnings that are still not very good and government mismanagement (of the economy)," Paixao said. "Foreign investors are not very optimistic about Brazil." While most analysts expect interest rates to rise in coming months to deal with mounting inflation pressure, the Bovespa may not suffer additional losses as a result. "We believe that better growth accompanied by fewer interventionist policies will minimize the negative effects that an interest rate rise would create among investors," JPMorgan analyst Emy Shayo Cherman wrote in an investor note on Thursday. Mexico's IPC index fell for the third session in four, losing 0.34 percent to 42,353.27. Broadcaster Grupo Televisa fell 1.5 percent, contributing most to the index's losses, as Mexico's congress prepared to vote on a sweeping reform bill for the telecommunications sector. Chile's IPSA index fell for the first session in three, dropping 0.35 percent to 4,441.74, as shares of industrial conglomerate Copec fell 0.7 percent. Latin America's key stock indexes at 1521 GMT: Stock indexes daily % YTD % Latest change change MSCI LatAm 3,768.75 -0.46 -0.3 Brazil Bovespa 55,830.88 -0.36 -8.40 Mexico IPC 42,353.27 -0.34 -3.09 Chile IPSA 4,441.74 -0.35 3.26 Chile IGPA 21,751.75 -0.29 3.23 Argentina MerVal 3,473.12 -0.34 21.68 Colombia IGBC 13,943.59 -0.02 -5.25 Peru IGRA 19,868.46 0.08 -3.69 Venezuela IBC 632,130.00 0 34.09
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