March 25, 2019 / 3:28 PM / 2 months ago

EMERGING MARKETS-Latam stocks and currencies rebound from fierce sell-off

    By Agamoni Ghosh
    March 25 (Reuters) - Latin American currencies rose on
Monday, led by Brazil's real as the U.S. dollar took a back
seat, while stocks in the region edged higher, with Mexican
stocks leading gains. 
    MSCI's index of Latin American currencies
and stocks both rebounded from their biggest
one-day drop since May 2017 in the previous session, after
growth fears hit risk sentiment across the globe.
    Weak economic data from Europe triggered a worldwide
sell-off on Friday that worsened after more disappointing U.S.
numbers came in. But an unexpected rise in German business
sentiment on Monday help temper those losses.
    Brazilian assets, which faced a tumultuous session on Friday
due to the global sell-off and the arrest of ex-President Michel
Temer, partly recovered, with the real gaining over 1
percent and stocks on the Bovespa snapping a four-day
losing streak.
    "Yes, the arrest added to the weakness but it was a bad day
for EM currencies overall," said Christian Lawrence, senior
market strategist, Latam FX, at Rabobank. 
    Temer's arrest stoked concerns that the country's political
focus will shift to the former president and slow proposed
pension reform, seen as critical to injecting life into a tepid
economic recovery.
    The Brazilian currency also got a boost after data showed
the current account deficit in February narrowed by over a
billon dollars compared with a year earlier.  
    Mexico's peso rose 0.3 percent, while stocks on the
IPC index rose the most in the region, with building
materials supplier Mexichem leading gains after 
Santander raised its price target on the stock.    
    Chile's peso rose 0.1 percent, supported by a slight
rise in the price of copper, the country's main export, while
stocks on the IPSA index were the only losers in
the region.      
    Markets in Colombia were shut for St Joseph's Day. 
    
    Key Latin American stock indexes and currencies at 1515 GMT
    
    
 Stock indexes                        daily %
                             Latest    change
 MSCI Emerging Markets       1047.20    -1.17
                                      
 MSCI LatAm                  2738.58     0.94
                                      
 Brazil Bovespa             94225.28     0.52
                                      
 Mexico IPC                 42568.54     0.73
                                      
 Chile SPCLXIPSA             5176.68    -0.64
                                      
 Argentina MerVal           33123.35      0.9
                                      
 Colombia IGBC                     -        -
                                      
                                             
 Currencies                           daily %
                                       change
                              Latest  
 Brazil real                  3.8657     0.91
                                      
 Mexico peso                 19.0255     0.32
                                      
 Chile peso                    678.1     0.21
                                      
 Colombia peso                     -        -
 Peru sol                      3.299     0.00
                                      
 Argentina peso              41.6300     0.48
 (interbank)                          
                                      
 

 (Reporting by Agamoni Ghosh; Editing by Dan Grebler)
  
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