SAO PAULO, May 22 Latin American currencies and
stocks gained on Thursday following better-than-expected
manufacturing data from China, though Brazil's real weakened
after the central bank hinted that a currency intervention
program currently in place may change.
Data on Thursday showed China's factory sector posted its
best performance in five months in May, relieving investor
concerns over an economic slowdown in a key purchaser of Latin
American commodities such as soybeans, copper and iron-ore.
Brazil's Bovespa stock index erased the previous
session's losses, driven by preferred shares of iron-ore miner
Vale SA, which counts China as its biggest customer.
Bank shares posted a partial rebound a day after a second-tier
court ruled against the industry in a decades-old case over
disputed compensation for savings accounts.
"No one knows what the impact will be yet, as there are many
variables," said Hersz Ferman, an economist with brokerage Elite
Corretora in Rio de Janeiro. "That's why the stocks are
volatile, though with a negative bias."
Mexico's IPC stock index rose for a second day,
driven by shares of broadcaster Grupo Televisa.
Mexican annual inflation eased to a seven month low in early
May, boosting expectations that policymakers will leave interest
rates on hold this year at a record low to support weak growth.
Most Latin American currencies strengthened against the
dollar, tracking a rise in global risk appetite.
Brazil's real reversed early gains, however, after
central bank chief Alexandre Tombini said on Thursday that
demand for currency swaps being offered under the bank's
currency intervention program has decreased.
"The market interpreted that the central bank could reduce
the supply of swaps or interrupt the daily intervention
program," said Flavio Serrano, senior economist with Espirito
Santo Investment Bank in Sao Paulo.
The currency swaps provide hedges against currency losses.
The central bank started its daily intervention program in the
foreign exchange market in August to stem a sharp drop in the
real, but slowed its pace this year.
Key Latin American stock indexes and currencies at 1511 GMT:
Stock indexes daily % YTD %
Latest change change
MSCI Emerging Markets 1039.94 0.8 2.89
MSCI LatAm 3325.2 0.32 3.56
Brazil Bovespa 52420.06 0.42 1.77
Mexico IPC 41955.1 0.3 -1.81
Chile IPSA 3911.83 0.79 5.75
Chile IGPA 19149.95 0.63 5.06
Argentina MerVal 7349.9 1.22 36.34
Colombia IGBC 13630.22 -0.14 4.28
Peru IGRA 15671.12 0.19 -0.52
Venezuela IBC 2188.4 0 -20.03
Currencies daily % YTD %
Brazil real 2.2153 -0.31 6.39
Mexico peso 12.8872 0.32 1.11
Chile peso 550.1 0.49 -4.36
Colombia peso 1900.95 0.50 1.63
Peru sol 2.787 0.07 0.22
Argentina peso (interbank) 8.0600 0.03 -19.45
Argentina peso (parallel) 11.95 1.26 -16.32
(Reporting by Priscila Jordao and Bruno Federowski; Writing by
Asher Levine; editing by Andrew Hay)