December 18, 2019 / 7:32 PM / a month ago

EMERGING MARKETS-Brazil, Argentine stocks lead Latam equities higher

    * Improving global outlook spurs demand for Latam assets
    * Argentine stocks hit over 4-month high
    * MSCI index of Latam stocks hits highest level since
late-July
    * Most regional currencies slightly stronger

 (Recasts with stocks, updates prices)
    By Ambar Warrick
    Dec 18 (Reuters) - Latin American stocks rose on Wednesday
as Brazilian markets hit a record high, while Argentine equities
surged after the country's central bank chief flagged potential
interest rate cuts in the short-term. 
    Brazil's stock index jumped about 1.3% to hit a
record high, helped by financials and energy stocks.
    A massive overhaul of Brazil's pension system earlier in the
year, coupled with record low interest rates and recovering
domestic demand, has created a rosy picture for Latin America's
largest economy going into the next year.  
    Late on Tuesday, Brazil's Congress approved the federal
government's budget for next year, based on projected economic
growth of 2.32%.
    The MSCI's index of Latin American stocks
touched its highest in nearly four months. Brazilian stocks are
the heaviest members of the index.
    Argentine stocks rose to their highest in more than
four months as the country's central bank chief said interest
rates would "surely" go down in the near term, and that
Argentina's debt would not be difficult to
restructure.
    The country is set to begin talks with creditors over
restructuring its huge debt overhang, in the near-term. Concerns
over the country defaulting on its debt had caused a massive
drop in the peso earlier in the year, and had sent
inflation sky-rocketing.
    Mexican stocks jumped to their highest since
late-April, with Banco Santander Mexico extending
gains after JP Morgan upgraded the stock. 
     Chilean stocks fell for a third straight day. 
     Regional currencies firmed slightly, with Brazil's real
 strengthening slightly to the dollar.
    The Chilean peso rose for the sixth day in a row,
recovering from a steep fall in November sparked by violent
anti-government protests. 
    "Global markets have calmed down and sentiment is generally
more friendly towards emerging market currencies, which is
reflected particularly in Latam currencies," said Thu Lan
Nguyen, FX strategist with Commerzbank.
    The Mexican peso trended slightly lower ahead of a
widely expected interest rate cut on Thursday. A Reuters poll
expects a 25 basis point-cut.
    
    Key Latin American stock indexes and currencies at 1910 GMT:
 
    
    Stock indexes             Latest    Daily % change
 MSCI Emerging Markets         1108.61            0.54
                                        
 MSCI LatAm                    2894.64             1.1
                                        
 Brazil Bovespa              114112.83            1.33
                                        
 Mexico IPC                   44920.61            1.17
                                        
 Chile IPSA                    4739.27           -1.57
                                        
 Argentina MerVal             38522.87           4.345
                                        
 Colombia COLCAP               1624.09           -0.06
                                        
                                                      
       Currencies             Latest    Daily % change
 Brazil real                    4.0632            0.01
                                        
 Mexico peso                   18.9657           -0.21
                                        
 Chile peso                     751.95            0.51
                                        
 Colombia peso                    3324            0.48
 Peru sol                        3.338            0.03
                                        
 Argentina peso                59.8150            0.00
 (interbank)                            
                                        
 
     

 (Reporting by Sagarika Jaisinghani and Ambar Warrick in
Bengaluru
Editing by Alistair Bell)
  
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