February 26, 2020 / 8:51 PM / in a month

EMERGING MARKETS-Brazil's real touches new low, stocks hit by fears of fast-spreading virus

    * Brazil confirms first coronavirus case in LatAm
    * Brazilian stocks eye worst day in more than 33 months 
    * Mexico central bank cuts 2020 growth forecast  
    * Argentine peso hits six-month low

 (Adds Brazil's movement, market strategist comments, updates
prices throughout)
    By Shreyashi Sanyal
    Feb 26 (Reuters) - Brazil's real touched a record low on
Wednesday as traders returned from the Carnival holiday only to
be alarmed by concerns about the spread of the new coronavirus
after Sao Paulo confirmed its first case.
    The real weakened 1.1% to 4.4470 against the dollar,
as it led declines among other Latin American currencies. 
    Brazilian markets reopened to a shock on Wednesday, with
stocks tumbling more than 7% as they were on track to
log their worst one-day percentage fall since May 2017.  
    Airlines Azul and Gol and major
commodity exporters Vale and Petrobras
were hit the hardest.    
    "Brazil is trying to catch up to all the drops we have seen
in the global market and with the new case that came out, put
all that together and you expect this type of reaction to show
up," said Gaurav Mallik, chief portfolio strategist at State
Street Global Advisors in Boston.  
    MSCI's index for Latin American stocks
tumbled 5.8%. MSCI's index of world stocks lost
$3.3 trillion over the last four sessions.
    As the virus spreads to more parts of Asia, Europe and the
Middle East, the number of infected cases has risen to about
80,000 globally, while the death toll exceeds 2,700.

    Germany said on Wednesday that it was heading for a
coronavirus epidemic and could no longer trace all cases, while 
health officials in New York said they were monitoring 83 people
who visited China. 
    Fears have risen that the economic impact of travel curbs,
disruptions to operations and falling demand might be far
greater than previously anticipated. 
    Mexico's peso also eased against the dollar as the
central bank cut its 2020 economic growth forecast and hiked its
inflation view. The Banco de Mexico said projections were
shrouded in uncertainty because it was unclear how the spread of
the coronavirus would dent global growth. 
    Argentina also returned from an extended weekend with its
peso touching a six-month low on Wednesday, while the
Merval stock index plummeted as much as 6.6% as they
caught up with the rout across global markets this week.    
    Chile stocks fell to a three-year low, down 1.5%,
while the currency eked out gains. 
    Chilean Finance Minister Ignacio Briones said he expected
the outbreak to have a "limited" impact on Chile's economy
despite its dependence on China for the export of its main
commodity, copper.    
    Latin American stock indexes and currencies at 1524 GMT:
    
     Stock indexes              Latest     Daily %
                                            change
 MSCI Emerging Markets            1042.78      -1.3
                                           
 MSCI LatAm                       2501.10     -5.84
                                           
 Brazil Bovespa                 105108.38     -7.54
                                           
 Mexico IPC                      42868.52     -0.41
                                           
 Chile IPSA                       4297.70     -1.46
                                           
 Argentina MerVal                36422.24    -5.648
                                           
 Colombia COLCAP                  1589.38     -1.43
                                           
                                                   
        Currencies              Latest     Daily %
                                            change
 Brazil real                       4.4404      0.07
                                           
 Mexico peso                      19.2170     -0.71
                                           
 Chile peso                         810.1      0.14
                                           
 Colombia peso                       3455     -0.59
 Peru sol                           3.409      0.03
                                           
 Argentina peso (interbank)       62.0875     -0.40
                                           
 
    

 (Reporting by Shreyashi Sanyal and Susan Mathew in Bengaluru;
editing by Grant McCool)
  
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