April 8, 2019 / 9:41 PM / 3 months ago

EMERGING MARKETS-Latam FX firms versus soft dollar, stocks hit 2-1/2 week peak

 (Recasts throughout, updates prices, adds market strategist's
quote)
    By Aaron Saldanha
    April 8 (Reuters) - Latin American currencies firmed on
Monday, helped by a soft dollar as global risk appetite rose,
while equities in Latin America climbed on gains clocked in each
of the region's countries, especially among resource stocks.    
    Demand for the dollar was dented by easing fears of global
growth slowing at the start of a week featuring a slew of data
due from China, a key buyer of Latin America's resources
exports. Chinese inflation and trade data for March is due later
this week.     
    "While the market has been expecting better China data,
positioning is still light," Dirk Willer, Citi Research's head
of emerging market strategy, and Kenneth Lam, emerging markets
FX strategist, wrote in a note.
    "We are positive on Latam FX as the better China sentiment
is gathering steam." 
    MSCI's Latin American currencies index
gained 0.1 percent, while its index of Latin American stocks
 was up half a percent, after hitting a two and a
half week high earlier in the day. 
    Brazil's real firmed 0.6 percent, while Sao
Paulo-traded stocks rose 0.3 percent, largely on gains
among materials and energy firms.
    State-run oil firm Petroleo Brasileiro SA (Petrobras) saw
its common shares and preferred shares
rise 2.2 percent and 1.6 percent, respectively.
    Credit Suisse upgraded its rating of Petrobras' U.S.-listed
shares and raised its price target to $21. 
    A rise in oil prices to a five-month peak was also a
supportive factor to Petrobras.
    Shares of miner Vale SA rose 2.7 percent,
tracking part of a 4.8 percent rise in iron ore prices in
Dalian, China.
    A group of Vale's minority shareholders have proposed an
alternative board member to challenge the independent members
within the group of 13 candidates presented by the firm's board,
newspaper Valor Economico reported.
    The pressure from minority shareholders reflects skepticism
toward Vale's board and management after a mining dam burst in
January left about 300 hundred dead. Vale opened talks with
prosecutors and victims' families, it said on Monday, with an
aim of defining compensation.
    Meatpacker JBS rose 3.9 percent, helped by HSBC
raising its price target on the stock and by strong beef export
data.
    Mexico's peso firmed half a percent, pierced through
the 19 peso-per-dollar mark and saw trading volumes at about
double their one-week average during trade on the day, as per
Refinitiv Eikon data.
    The currency is one of the developing world's most liquid
and is considered by some investors to be a weather vane of
trade sentiment.
    Mexican stocks rose 1 percent on strong showings by
financials and consumer staples.
    Chile's peso rose 0.2 percent, with prices of copper
, the country's top export, rising 1.2 percent on news of
stimulus measures in China. Chilean stocks gained
0.4 percent.
    Argentina's peso firmed to pull away from a record
closing low clocked on Friday, while local stocks rose
1.3 percent. 
    Colombia's peso firmed 0.3 percent, while local
stocks tacked on 1.1 percent, with energy firm Ecopetrol
SA riding on the back of higher oil prices to
gain 1.9 percent.
    
    Key Latin American stock indexes and currencies at 2106 GMT
    
 Stock indexes                                  daily %
                                    Latest       change
 MSCI Emerging Markets                1088.50      0.31
 MSCI LatAm                           2849.02      0.54
 Brazil Bovespa                      97369.29      0.27
 Mexico IPC                          45436.28      0.99
 Chile IPSA                           5274.72      0.38
                                               
 Argentina MerVal                    33080.87      1.27
 Colombia IGBC                       13252.76      1.08
                                                       
 Currencies                                     daily %
                                                 change
                                       Latest  
 Brazil real                           3.8495     -0.03
 Mexico peso                          18.9605      0.00
                                               
 Chile peso                            663.65      0.13
 Colombia peso                        3113.25      0.00
 Peru sol                               3.288      0.18
 Argentina peso (interbank)           43.6000      0.85
                                               
 
 (Reporting by Aaron Saldanha in Bengaluru
Editing by Phil Berlowitz)
  
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