May 29, 2018 / 3:51 PM / 5 months ago

EMERGING MARKETS-Brazil stocks jump as traders see a bargain

    SAO PAULO, May 29 (Reuters) - Brazilian equities bounced
more than 2 percent on Tuesday, leading regional gains as
traders searched for bargains after four straight sessions in
the red, while the nation's real currency also outperformed
other currencies in the region.
    Brazil's benchmark Bovespa equities index had fallen
some 8 percent over the previous eight days and plunged more
than 4 percent on Monday alone as an eight-day trucker strike
hit key sectors of the economy, even as there were signs it was
winding down.
    Among the hardest hit stocks was state-run oil major
Petroleo Brasileiro SA, known as Petrobras, which
slumped some 15 percent on Monday as the government softened the
company's pricing policy in a bid to win over truckers
protesting high fuel prices.
    On Tuesday, traders saw opportunities across the board, with
multiple banks arguing that some stocks have attained attractive
valuations during the selloff, which as of Monday's close wiped
out the Bovespa's gains for the year.
    Analysts at Banco Santander Brasil SA flagged discount
retailer Lojas Americanas SA, energy company
Equatorial Energia SA, bank Itau Unibanco Holding SA
 and tire manufacturer Iochpe Maxion SA as
potential buys in a research note. 
    Analysts at UBS AG said in a note that some stocks in the
transport sector had seen "an exaggerated sell-off," pointing to
rental car company Localiza Rent A Car SA, airline
Azul SA, auto part maker Tupy SA as well as
Iochpe.
    The big index mover on the day was Petrobras, which jumped
8.1 percent by late morning.
    The Bovespa was up 2.1 percent by mid-day, paring gains
after rising almost 2.5 percent in morning trade.
    The real currency was roughly flat on Tuesday,
outperforming other regional currencies as the dollar
strengthened. Traders described the political atmosphere as
somewhat calmer than in previous sessions, with those who had
been scooping up dollars shifting back into reais.
    "The real has become untied to other currencies today, as
the currency had a stressful day and now it's calmer," one
trader told Reuters. 
    Among regional currency markets, Mexico's peso was
the biggest loser, falling 0.95 percent against the dollar, as
the re-negotiation of the North American Free Trade Agreement
proceeds in fits and starts.
    
Key Latin American stock indexes and currencies at 1506 GMT:    
    
 Stock indexes                           daily %     YTD %
                             Latest       change    change
 MSCI Emerging Markets         1126.37     -0.93     -1.85
                                                  
 MSCI LatAm                    2567.74      0.12     -9.31
                                                  
 Brazil Bovespa               76367.09      1.34     -0.05
                                                  
 Mexico IPC                   44720.02     -0.29     -9.39
                                                  
 Chile IPSA                    5545.93     -0.43     -0.34
                                                  
 Chile IGPA                   28050.63     -0.48      0.25
                                                  
 Argentina MerVal             28874.40      0.77     -3.96
                                                  
 Colombia IGBC                12231.78      1.73      7.57
                                                  
 Venezuela IBC                32820.39      0.96   2498.32
                                                  
                                                          
 Currencies                              daily %     YTD %
                                          change    change
                                Latest            
 Brazil real                    3.7297     -0.07    -11.16
                                                  
 Mexico peso                   19.7385     -0.95     -0.20
                                                  
 Chile peso                      626.7     -0.35     -1.92
                                                  
 Colombia peso                 2884.81     -0.37      3.37
 Peru sol                        3.279     -0.12     -1.28
                                                  
 Argentina peso                24.9125     -0.57    -25.34
 (interbank)                                      
                                                  
 Argentina peso                  25.95     -0.39    -25.90
 (parallel)                                       
                                                  
 

 (Reporting by Gram Slattery; Additional reporting by Paula
Arend Laier; Editing by Meredith Mazzilli)
  
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