June 25, 2020 / 2:11 PM / 9 days ago

EMERGING MARKETS-Latam stocks fall on virus woes; Mexican peso weak before rate move

    By Shreyashi Sanyal
    June 25 (Reuters) - Latin American stocks were bogged down
on Thursday by a rise in coronavirus cases in the region, while
the Mexican peso underperformed on bets of more monetary easing
ahead of a central bank meeting later in the day. 
    The peso slipped 0.3% against the dollar, as
investors expected the Bank of Mexico to cut the key interest
rate by 50 basis points to 5.0% in a bid to alleviate the
pandemic's economic pain. 
    "The Mexican central bank (Banxico) is likely to continue
its rate cut cycle today; by now the key rate in Mexico is much
higher than in many other emerging market countries," said
You-Na Park-Heger, FX and emerging markets analyst at
Commerzbank. 
    "It is quite possible that the central bank will even
provide an indication in its statement that it has almost
reached the end of the rate cut cycle. If that were to be the
case, the peso might benefit." 
    MSCI's index for Latin American stocks fell
1.3% on Thursday and has fallen 32% this year, with the region
emerging as a new global coronavirus hot spot and investors
questioning the pace of any recovery.       
    Researchers said the death toll from COVID-19 in Latin
America is expected to rocket to 388,300 by October, with Brazil
and Mexico seen accounting for two-thirds of fatalities.
 
    The Brazilian real fell 0.3% after the central bank
slashed its 2020 economic growth forecast to minus 6.4% from
zero due to the COVID-19 crisis, and warned that uncertainty
surrounding the pace of recovery in the second half of this year
remains unusually high.
    The Chilean peso strengthened against the dollar,
price of copper, the country's biggest export, pushing higher as
a surge in coronavirus cases fueled worries about mine shutdowns
and shortages.
    Chilean state miner Codelco, the world's largest copper
producer, on Wednesday reported the death of a third worker from
the new coronavirus.
    In Argentina, Economy Minister Martin Guzman said the
country is working with its creditors to reach a debt
restructuring deal after talks stalled, though there is still
distance to cover in economic and legal terms.    
    
    Key Latin American stock indexes and currencies at 1356 GMT
    
 Stock indexes          Latest        Daily %
                                      change
 MSCI Emerging             1002.60        -0.81
 Markets                            
 MSCI LatAm                1902.64        -1.29
                                    
                                    
 Brazil Bovespa           94683.56         0.32
                                    
 Mexico IPC               37850.91        -0.15
                                    
 Chile IPSA                4008.52        -0.69
                                    
 Argentina MerVal             0.00            0
                                    
 Colombia COLCAP           1120.42        -0.45
                                    
                                               
    Currencies          Latest        Daily %
                                      change
 Brazil real                5.3394        -0.31
                                    
 Mexico peso               22.8283        -0.22
                                    
 Chile peso                  814.1         0.53
                                    
 Colombia peso             3732.02        -0.13
                                    
 Peru sol                   3.5058         0.05
                                    
 Argentina peso            70.1500        -0.07
 (interbank)                        
                                    
 

 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Dan
Grebler)
  
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below