July 12, 2019 / 2:21 PM / 9 days ago

EMERGING MARKETS-Latam forex, stocks extend Fed-driven rally

    July 12 (Reuters) - Most Latin American currencies extended
gains on Friday after dovish signals from the U.S. Federal
Reserve, with the Brazilian real holding at over three-month
highs as investors welcomed progress in the government's pension
reform bill.
    Brazil's markets have surged in recent days on prospects for
the pension system overhaul, while signals from the Fed about
potential interest rate cuts helped capital inflows into risky,
emerging market assets. 
    The real, up about 0.4%, is on course to post gains
in a week that saw the lower house of Congress pass the main
text of the bill by a wide majority. It now faces a second-round
vote before going to the Senate for final approval.
    Speaker Rodrigo Maia said the lower house will try to
conclude voting before the break for recess on July 18.

    "Brazil's pension reform is moving forward more quickly than
even the most optimistic forecasters expected," FX strategists
at RBC wrote in a note.
    The Bovespa stock index edged lower after gaining
for five straight days, weighed down by banking shares.
    Retailer Magazine Luiza jumped 3.5%, topping
gains on the Bovespa, after the company said it approved a
1-for-8 stock split, a transaction that will keep its capital
stock unchanged at 1.77 billion reais ($470 million).

    The Mexican peso rose about 0.3%. Minutes from
Mexico's central bank meeting showed on Thursday most
policymakers recommend maintaining a cautious monetary policy
stance because of mixed inflation signals.
    The Colombian peso also gained, but the Chilean peso
 edged lower amid concerns about demand for its top
export, copper.
    Data showed China's unwrought copper imports in June fell
27.2% from a year earlier, as a slowdown in the world's
second-biggest economy continues to weigh on demand for the
metal.
     

    Latin American stock indexes and currencies at 1923 GMT
    
 Stock indexes                       daily %
                            Latest    change
 MSCI Emerging Markets      1052.73    -0.23
                                     
 MSCI LatAm                 2967.90     0.36
                                     
 Brazil Bovespa           105038.28     -0.1
                                     
 Mexico IPC                42822.81    -0.14
                                     
 Chile IPSA                 5083.31     0.17
                                     
 Argentina MerVal              0.00        0
                                     
 Colombia IGBC             12982.61    -0.17
                                     
                                            
 Currencies                          daily %
                                      change
                             Latest  
 Brazil real                 3.7368     0.38
                                     
 Mexico peso                19.0157     0.28
                                     
 Chile peso                   681.1    -0.16
                                     
 Colombia peso              3188.57     0.26
                                     
 Peru sol                         -        -
                                     
 Argentina peso                   -        -
 (interbank)                         
                                     
 

 (Reporting by Sruthi Shankar in Bengaluru
Editing by Susan Thomas)
  
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