March 1, 2017 / 5:10 PM / 5 months ago

EMERGING MARKETS-Mexico peso firms as Trump adopts restrained tone

4 Min Read

    SAO PAULO, March 1 xx (Reuters) - The Mexican peso
strengthened on Wednesday after U.S. President Donald Trump took
a conciliatory stance in a key speech, backing away from his
harsh campaign rhetoric.
    The peso has weakened sharply since Trump's unexpected Nov.
8 election victory as he vowed to curtail trade and financial
flows with Mexico.
    In a prime-time televised address to the country on Tuesday,
Trump offered a more restrained tone than during his election
campaign, telling Congress he was open to immigration reform.

    The peso firmed 1 percent, outperforming other
mostly flat Latin American currencies.
    Demand for emerging market currencies was muted after a
handful of U.S. Federal Reserve policymakers signaled the
possibility of a March interest rate increase.
    Higher U.S. rates could drain investments away from
high-yielding assets.
    Still, Brazil's benchmark Bovespa stock index rose
0.7 percent, supported by rising shares of state-controlled oil
company Petróleo Brasileiro SA.
    Petrobras, as the company is known, announced late on Friday
that it would cut prices for diesel and gasoline at domestic
refineries.
    In a client note, analysts at Credit Suisse Securities led
by André Natal said the spread between local gasoline prices and
import prices remains at attractive levels, at roughly 13
percent.
    Brazilian markets did not open on Monday and Tuesday due to
a local holiday.
    
    Key Latin American stock indexes and currencies at 1700 GMT:
 Stock indexes                           daily %    YTD %
                                          change   change
                              Latest              
 MSCI Emerging Markets           937.93     0.17     8.59
                                                  
 MSCI LatAm                     2627.30     1.05    11.08
                                                  
 Brazil Bovespa                67154.20     0.74    11.50
                                                  
 Mexico IPC                    47438.71     1.24     3.93
                                                  
 Chile IPSA                     4382.14     0.51     5.56
                                                  
 Chile IGPA                    21918.07     0.49     5.71
                                                  
 Argentina MerVal              19358.68     1.26    14.43
                                                  
 Colombia IGBC                  9909.00      0.2    -2.16
                                                  
 Venezuela IBC                 36228.78     1.45    14.27
                                                  
                                                         
 Currencies                              daily %    YTD %
                                          change   change
                                 Latest           
 Brazil real                     3.1039     0.25     4.68
                                                  
 Mexico peso                    19.9050     1.00     4.22
                                                  
 Chile peso                       650.5    -0.05     3.11
                                                  
 Colombia peso                  2933.16    -0.32     2.33
 Peru sol                         3.255     0.18     4.88
                                                  
 Argentina peso (interbank)     15.4500     0.19     2.75
                                                  
 Argentina peso (parallel)         16.2     0.49     3.83
                                                  
 

 (Reporting by Bruno Federowski; Editing by Jonathan Oatis)
  

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