September 18, 2018 / 9:06 PM / a month ago

EMERGING MARKETS-Brazil's Bovespa boosted by spike in commodities prices

 (Updates prices)
    SAO PAULO, Sept 18 (Reuters) - Brazil's benchmark Bovespa
index rose 1.75 percent on Tuesday, rallying for a
second straight day largely on a spike in commodities prices. 
    Two of the Bovespa's most heavily weighted equities, miner
Vale and oil giant Petroleo Brasileiro SA, commonly
known as Petrobras, benefited from rising commodity
prices worldwide amid escalating China-U.S. trade tensions and
signals OPEC is not prepared to raise output to address
shrinking supplies from Iran.
    With three weeks to go before the first round of Brazil's
presidential election, investors are adjusting their
expectations now that Geraldo Alckmin, the favorite of financial
markets, is no longer considered likely to secure a spot in the
run-off likely to occur later in October. That makes far-right
candidate Jair Bolsonaro increasingly the default choice for
investors
    "There's disbelief that Alckmin can move up, and the market
is betting on Bolsonaro," Brazilian broker Spinelli said in a
note to clients. 
    Throughout the region, currencies were up modestly against
the dollar, except in Brazil and Argentina,
where they were down slightly. Brazil's real and Argentina's
peso have posted by far the biggest losses in the region this
year, despite initial hopes the two countries would experience
significant economic recoveries in 2018.
    The Mexican peso strengthened 0.19 percent against a
weakening dollar after China announced that it would impose
tariffs on U.S. imports, retaliating against steps taken by U.S.
President Donald Trump's administration.
    Nevertheless, analysts at Banco Base wrote in a report that
the peso still may depreciate in the short term, particularly if
the United States and Canada progress in their talks to revamp
the North American Free Trade Agreement.
    
    Key Latin American stock indexes and currencies at 1955 GMT:
   
    
 Stock                         Latest      daily %  YTD % change
   indexes                                 change   
 MSCI Emerging Markets         1019.33     0.29     -12.26
                                                    
 MSCI LatAm                    2494.79     1.27     -12.89
                                                    
 Brazil Bovespa                78132.10    1.75     2.26
 Mexico IPC                    49666.71    0.54     0.63
 Argentina MerVal              32147.31    3.18     6.92
 Colombia IGBC                 12340.83    0.58     8.53
 Venezuela IBC                 336554.91   -4.31    26544.31
                                                    
 Currencies                    Latest      daily %  YTD % change
                                           change   
 Brazil real                   4.1401      -0.38    -19.97
 Mexico peso                   18.8100     0.19     4.73
 Chile peso                    686.8       0.00     -10.51
 Colombia peso                 3012.4      0.14     -1.01
                                                    
 Peru sol                      3.306       0.15     -2.09
 Argentina peso (interbank)    39.7300     -0.40    -53.18
                                                    
 Argentina peso (parallel)     39.25       1.91     -51.01
                                                    
 

 (Reporting by Marcelo Rochabrun and Paula Arend Laier in Sao
Paulo; additional reporting by Julia Love in Mexico City
Editing by Paul Simao and Dan Grebler)
  
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