EMERGING MARKETS-Latam markets rise as China data calms investors

Wed Apr 16, 2014 12:47pm EDT

By Asher Levine
    SAO PAULO, April 16 (Reuters) - Latin American stocks rose
on Wednesday as investors breathed a sigh of relief after
economic growth data from China, a major trade partner for the
region, came in better than expected.
    The MSCI Latin American stock index rose its
most in over a week, while most currencies strengthened. 
    China's economy grew 7.4 percent in the first quarter from a
year earlier, beating forecasts of 7.3 percent and calming
investor concerns over a slowdown in the world's No. 2 economy
after a string of recent soft numbers. 
    China is Brazil's top trading partner and a big purchaser of
Latin American commodity exports such as iron ore, soybeans and
copper.
    Brazil's Bovespa stock index clawed back some of the
previous session's losses, rising to about 51,000 points. Shares
of banks and commodities firms led the way in spite of weak
Brazilian economic activity data released before the market
opened.
    "The market had already priced in the (Brazil) data and
focused more today on the more positive data from China
overnight," said Ricardo Zeno, a partner with AZ Investimentos
in Sao Paulo. "The market should remain in this channel between
50,000 points and 52,000 points. I don't see many motives for
the market to go beyond these levels until (October's
presidential) elections."
    Elsewhere in Latin America, Mexico's IPC index erased
the previous session's loss, though gains were limited by a 2.9
percent fall in conglomerate Alfa. The company
reported a sharp drop in first-quarter profit late on Tuesday.
 
    Chile's IPSA index rose for the third day in four,
driven by an over 10 percent gain in shares of Empresas La Polar
. A local trader said the gains were most likely driven
by the company's recent efforts to ameliorate its debt load
though discussions with creditors. 
    In currency markets, the Mexican and Colombian pesos
  both strengthened about 0.4 percent against the
dollar, with traders citing greater risk appetite following the
China data. The Brazilian real and Chilean peso 
fluctuated near unchanged levels through afternoon trading.
    A Reuters poll on Wednesday suggested the next two years
would be more challenging for Latin American economies than
previously thought, with prospects for slower growth and higher
inflation defying recent market optimism about emerging markets.
 
    
    Key Latin American stock indexes and currencies at 1627 GMT:
 Stock indexes                             daily %     YTD %
                               Latest       change    change
 MSCI Emerging Markets           1002.43      0.25     -0.28
                                                    
 MSCI LatAm                      3242.01      0.85      0.43
                                                    
 Brazil Bovespa                 50996.69      1.07     -0.99
                                                    
 Mexico IPC                     40753.19      0.67     -4.62
                                                    
 Chile IPSA                      3901.68      0.62      5.47
                                                    
 Chile IGPA                     19115.06      0.55      4.87
                                                    
 Argentina MerVal                6368.47      0.82     18.13
                                                    
 Colombia IGBC                  13767.31      -0.3      5.32
                                                    
 Peru IGRA                      14662.82       0.3     -6.92
                                                    
 Venezuela IBC                   2472.45         0     -9.65
                                                    
                                                            
 Currencies                                daily %     YTD %
                                            change    change
                                  Latest            
 Brazil real                      2.2319      0.21      5.60
                                                    
 Mexico peso                     13.0382      0.47     -0.06
                                                    
 Chile peso                        556.6     -0.14     -5.48
                                                    
 Colombia peso                   1927.64      0.36      0.23
 Peru sol                          2.781      0.04      0.43
                                                    
 Argentina peso (interbank)       8.0000      0.03    -18.84
                                                    
 Argentina peso (parallel)         10.35      0.48     -3.38
                                                    
 
 (Additional reporting by Anthony Esposito in Santiago; Editing
by Jonathan Oatis)