October 30, 2017 / 3:22 PM / a year ago

EMERGING MARKETS-Brazilian markets down on lingering political concerns

    By Bruno Federowski
    SAO PAULO, Oct 30 (Reuters) - The Brazilian real weakened on
Monday as investors fretted over President Michel Temer's
ability to pass belt-tightening measures.
    Concerns over his platform of structural reforms, seen as
key to curb growth of public debt and boost long-term economic
growth, had driven the biggest weekly decline in the Brazilian
currency since mid-May. 
    Lawmakers cleared Temer of corruption charges last week, but
a smaller show of support than a similar vote earlier this year
cast doubt over his plans to streamline the social security
    "I'm still pessimistic over the approval of a pension
reform. With economic data improving, politicians may as well
delay such decisions in order not to lose voter support," Wagner
Investimentos director José Faria Júnior said.
    The Brazilian real slipped 0.6 percent, leading
losses in the region. 
    The Mexican peso slipped 0.2 percent, while the
Chilean peso was down 0.5 percent following a local
holiday on Friday.
    Traders avoided making risky bets ahead of the nomination of
the next Federal Reserve chair later this week, which should
provide further guidance on the pace of U.S. interest rate hikes
in coming months.
    Higher U.S. rates could dampen demand for high-yielding
assets, reducing the value of emerging market currencies.
    Political concerns pushed Brazil's benchmark Bovespa stock
index 1 percent lower. It was also weighed down by a
batch of mixed corporate results including steelmakers Cia
Siderúrgica Nacional SA and Usinas Siderúrgicas de
Minas Gerais SA, drugmaker Hypermarcas SA
and home furnishings producer Duratex SA.
    Key Latin American stock indexes and currencies at 1500 GMT:
 Stock indexes                                daily %    YTD %
                                     Latest    change   change
 MSCI Emerging Markets               1116.16     0.54    28.76
 MSCI LatAm                          2836.78    -0.52    21.83
 Brazil Bovespa                     75188.71    -1.04    24.84
 Mexico S&P/BVM IPC                 49068.68    -0.29     7.51
 Chile IPSA                          5558.79     0.77    33.90
 Chile IGPA                         27858.05     0.72    34.36
 Argentina MerVal                   27420.79    -0.21    62.08
 Colombia IGBC                      10681.50    -0.74     5.46
 Venezuela IBC                        709.15     0.03   -97.76
 Currencies                                   daily %    YTD %
                                               change   change
 Brazil real                          3.2640    -0.64    -0.45
 Mexico peso                         19.1630    -0.22     8.25
 Chile peso                            636.7    -0.46     5.34
 Colombia peso                       3003.56     0.21    -0.07
 Peru sol                               3.25    -0.12     5.05
 Argentina peso (interbank)          17.6150     0.06    -9.88
 Argentina peso (parallel)             18.09     0.17    -7.02
 (Reporting by Bruno Federowski; Editing by Meredith Mazzilli)
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