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Ambar Warrick

EMERGING MARKETS-Latam stocks at over three-week high as Brazil mounts record peak

05 Dec 2019

* MSCI's Latam stock index at highest since Nov 12 * Chile stocks, peso surge as C.bank holds benchmark rate * Argentine stocks down as C.bank chief resigns By Ambar Warrick Dec 5 Latin American stocks touched a more than three-week high on Thursday, with Brazilian stocks at a record peak as the country's senate approved a military pension reform bill. Stocks took support from lingering optimism over the Sino-U.S. trade war, after a Bloomberg report as well as positive comments from U.S. President Donald Trump brewed some hope over a "phase-one" trade deal. Regional markets have also been propped up by some positive economic readings this week, with better-than-expected GDP data from Brazil, Latin America's largest economy, being the most notable. Brazilian stocks extended Wednesday's gains to touch a fresh record high, as the Senate on Wednesday approved a bill that restructures the military's career and welfare, part of President Jair Bolsonaro's government welfare reform. With a major overhaul of the pension system in October, Brazil's markets have been particularly sensitive to any progress in Bolsonaro's program of streamlining government finances and releasing money into the private sector. Chilean stocks rose to a near two-week high, while MSCI's index of Latin American stocks rose as much as 0.3%. Chile's central bank on Wednesday said it would hold its benchmark interest rate and would likely keep it there for the next several months, even as weeks of protests begin to hammer the country's economy. However, the bank also slashed its economic growth forecasts for 2019 and 2020 on Thursday, warning that the effects of weeks of unrest would linger into next year. "Though it’s too early to say, especially if the Chilean peso reverses quickly and beyond the central bank's expectations, the higher inflation forecasts bias the next move to a hike," Citi analysts wrote in a note. "As for FX, a hawkish central bank with no cuts on the horizon should help stabilize the currency, which has been plagued by its low carry." The Chilean peso rose to its strongest level against the dollar in more than two weeks. The currency has been propped up by a massive central bank stimulus program, which went into effect earlier in the week. On the other hand, Argentine stocks dropped after central bank chief Guido Sandleris resigned on Wednesday, an expected step as Latin America's third-largest economy transitions to Peronism next week under newly elected President Alberto Fernandez. MSCI's index of Latin American currencies edged lower after four straight days of gains. Key Latin American stock indexes and currencies at 2333 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1041.67 0.49 MSCI LatAm 2709.95 0.19 Brazil Bovespa 110628.48 0.3 Mexico IPC - - Chile IPSA 4732.41 1.88 Argentina MerVal 34269.94 -1.216 Colombia COLCAP 1610.27 -0.11 Currencies Latest Daily % change Brazil real 4.2104 -0.21 Mexico peso 19.3718 0.28 Chile peso 783.8 0.51 Colombia peso 3456.09 0.33 Peru sol 3.3728 0.18 Argentina peso 59.8800 0.01 (interbank) (Reporting by Ambar Warrick in Bengaluru)

EMERGING MARKETS-EM assets nudge higher on lingering U.S.-China trade optimism

05 Dec 2019

Dec 5 Emerging market assets strengthened on Thursday amid some optimism over the prospects for a "phase-one" Sino-U.S. trade deal, although a raft of mixed signals earlier in the week kept gains constrained.

EMERGING MARKETS-Renewed trade hopes lift Latam stocks, Chile rate decision eyed

05 Dec 2019

(Updates prices) * U.S. and China move closer to phase-one trade deal - Bloomberg * Brazil shares at record high * Fitch says technical recession likely in Chile * Argentine central bank chief tenders resignation By Ambar Warrick and Susan Mathew Dec 4 Most Latin American stock markets staged a strong comeback on Wednesday, with Brazil shares scaling an all-time high, as U.S. President Donald Trump voiced more optimism than he did a day earlier about trade talks with China. After flagging a possible delay in reaching a deal with China on Tuesday, Trump earlier in the day said trade talks were going "very well." This followed a Bloomberg report that said both sides were closer to agreeing on the amount of tariffs that would be rolled back in a phase one trade deal. A basket of Latin American stocks jumped 1.3%, in line with a world-wide pick up in stocks. Brazil shares rose 1% with financials and energy stocks in the lead. MKTS/GLOB] Data showing Brazilian industrial production kept up its recovery in October came hot on the heels of strong third quarter economic growth numbers on Tuesday, brightening the picture for Latin America's largest economy. Data also showed overall business activity in Brazil remained unchanged in November from the prior month. The real currency firmed 0.1% against a slightly weaker dollar. Chile markets were among the strongest performers in the region, with stocks up 3.4%, while the currency gained 2%. All eyes are on a central bank meeting later in the day and while consensus expectations are for a cut, analysts say it could be a close call. "We've penciled in a cut, but are less confident about (a cut) than were a few days ago," said William Jackson, chief emerging markets economist at Capital Economics. "The pace of the fall in the peso over the past few days started to worry policymakers ... We saw the start of the quite large intervention program, which suggested they thought the currency may have overshot it, and they're trying to push back against that." Weeks of often violent protests in Chile over economic inequality had hammered its markets of late. Rating agency Fitch on Wednesday said the impact of protests may push the Chilean economy into a technical recession, expecting a contraction in the current quarter and the next. In Argentina, stocks spiked 5.5%, while peso closed down, before central bank chief Guido Sandleris presented his resignation, saying economic situation was, without a doubt worse, than expected. Oil exporters Mexico and Colombia's rose 0.6% and 1% respectively, tracking a surge in crude prices. Latin American stock indexes and currencies at 1939 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1037.38 -0.27 MSCI LatAm 2665.52 1.28 Brazil Bovespa 110070.89 1.02 Mexico IPC 42300.05 0.01 Chile IPSA 4644.98 3.38 Argentina MerVal 34576.71 5.556 Colombia COLCAP 1599.81 0.62 Currencies Latest Daily % change Brazil real 4.2021 0.07 Mexico peso 19.4370 0.57 Chile peso 787.8 2.09 Colombia peso 3467.5 0.94 Peru sol 3.379 0.30 Argentina peso 59.8800 0.07 (interbank) (Reporting by Susan Mathew in Bengaluru; editing by Grant McCool)

EMERGING MARKETS-Latam stocks rise on U.S.-China trade hopes; Brazil index at record high

04 Dec 2019

* Brazil stocks up as much as 0.8% * Chilean assets rise ahead of C.bank decision, rate cut likely * Chile rate cut to be close call- Analyst * Mexican, Colombian pesos up on strong oil prices By Ambar Warrick Dec 4 Latin American stock markets rose on Wednesday as U.S. President Donald Trump voiced more optimism than he did a day earlier about trade talks with China, and Brazilian equities mounted a record high, with an investment manager telling a Reuters forum the country was his top regional investment pick. Trump said that trade talks with China were going "very well." On Tuesday, he had flagged a possible delay in reaching a deal. A basket of Latin American stocks rose to a more than one-week high, pushed up mainly by a jump in Brazilian equities. Luiz Ribeiro, manager of the Latin America Equity Fund at asset manager DWS Group, said the region was poised for growth to rebound to nearly 2% in 2020 after years of underperformance. Ribeiro, who oversees $630 million in assets, told the Reuters Global Markets Forum that Brazil was his top investment pick in the region. Financials and energy stocks, which got a boost from stronger oil prices, were the best performers on the Bovespa. Industrial production in Brazil rose 0.8% in October, official figures showed, the third month in a row of growth after a steep decline. Data also showed overall business activity in the country remained unchanged in November from the prior month. Chilean stocks bounced back from a near three-week low touched on Tuesday. The Chilean peso also rose, supported by stronger prices for top export copper. Early this week, the Chilean central bank launched a large intervention program to support the floundering peso. Investors awaited an interest rate decision from Chile's central bank, scheduled for later in the day. A Reuters poll expects a cut, although analysts say it could be a close call. "We've penciled in a cut, but are less confident about (a cut) than were a few days ago," said William Jackson, chief emerging markets economist at Capital Economics. "The pace of the fall in the peso over the past few days started to worry policymakers... We saw the start of the quite large intervention program, which suggested they thought the currency may have overshot it, and they're trying to push back against that." An index of Latin American currencies rose about 0.2%, with the dollar also retreating after data showed U.S. private-sector job growth unexpectedly slowed to its weakest pace in six months in November. The currencies of oil exporters Mexico and Colombia also rose on stronger prices. Key Latin American stock indexes and currencies at 1437 GMT Stock indexes Latest Daily % change MSCI Emerging Markets 1037.60 0.02 MSCI LatAm 2688.63 0.87 Brazil Bovespa 109635.12 0.62 Mexico IPC - - Chile IPSA 4505.74 0.29 Argentina MerVal 33225.91 1.432 Colombia COLCAP 1591.09 0.07 Currencies Latest Daily % change Brazil real 4.1901 0.36 Mexico peso 19.4978 0.26 Chile peso 795.15 0.94 Colombia peso 3475.5 0.70 Peru sol 3.383 0.18 Argentina peso 59.8900 0.05 (interbank) (Reporting by Ambar Warrick in Bengaluru; Editing by David Gregorio)

EMERGING MARKETS-EM assets recoup most losses on upbeat Sino-U.S. trade report

04 Dec 2019

* U.S. services sector data awaited (Updates prices, adds details on Bloomberg report, graphic on China's yuan)

EMERGING MARKETS-EM stocks hit over 1-mth low as U.S.-China deal delay bites

04 Dec 2019

Dec 4 Developing world stocks sank to their lowest in more than a month on Wednesday in the face of further delays to a hoped-for end in Sino-U.S. trade ructions.

EMERGING MARKETS-Latam stocks dip on trade woes; Brazil FX firms on strong Q3 GDP

04 Dec 2019

(Updates prices, adds asset manager's comment) * Brazil real surges after better-than-expected GDP * Traders cautious after Trump says no trade deal deadline * Latam is poised for economic growth - asset manager By Ambar Warrick and Susan Mathew Dec 3 Latin American stock markets fell on Tuesday, with Mexican shares touching a two-month low, as comments by U.S. President Donald Trump sparked fears of a delay in resolving the Sino-U.S. trade war. Global equities dropped after Trump said a trade deal with China might be delayed until after the November 2020 U.S. presidential election. Possible U.S. duties on French goods also kept markets on edge. Investors had earlier expected an interim trade deal between Washington and Beijing by mid-November, but the prospect of a delayed conclusion now opens the door to a further escalation in the tensions that have dogged risk assets for more than a year. Tuesday's comments come after Trump restored metal tariffs on Brazil and Argentina on Monday, taking officials there by surprise. Argentina and Brazil plan to meet this week to discuss the tariffs and are expected to meet members of the Mercosur trade bloc on Wednesday. An index of Latin American stocks snapped a four-day winning run and was down 0.2%. Shares in Colombia , Brazil, Mexico and Chile gave up between 0.8% and 0.1%, while Argentine equities lost 2.3%. "Trade headlines are certainly making for cautious trade in markets ... the mood has certainly become less positive," said William Jackson, chief emerging markets economist at Capital Economics. Regional currencies fared slightly better, with an index of local units rising about 0.2% as the dollar held declines following disappointing manufacturing data from the United States on Monday. Brazil's real firmed 0.3% after data showed the country's economy expanded faster than expected in the third quarter. Upward revisions to GDP figures for the first two quarters this year also meant that Latin America's largest economy steered further clear of recession than previously thought. Latam is poised for growth after years of underperformance, Luiz Ribeiro, manager of the Latin America Equities fund at asset manager DWS Group, told the Reuters Global Markets Forum on Tuesday, forecasting regional growth would rebound in 2020 to near 2%. Mexico's peso traded flat amid a push back by the Mexican government against U.S. attempts to subject Mexico to oversight of its labor market. President Andres Manuel Lopez Obrador said the Mexican Senate should be consulted before changes to a new North American trade deal are signed off. Key Latin American stock indexes and currencies at 1930 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1036.23 -0.38 MSCI LatAm 2658.21 -0.18 Brazil Bovespa 108812.52 -0.11 Mexico IPC 42377.26 -0.39 Chile IPSA 4491.53 -0.22 Argentina MerVal 32691.67 -2.258 Colombia COLCAP 1586.14 -0.76 Currencies Latest Daily % change Brazil real 4.2078 0.13 Mexico peso 19.5790 -0.01 Chile peso 802.6 0.07 Colombia peso 3500.4 0.07 Peru sol 3.389 0.06 Argentina peso 59.9100 0.10 (interbank) (Additional reporting by Lisa Pauline Mattackal and Aaron Saldanha ion Bengaluru; Editing by Giles Elgood)

EMERGING MARKETS-Latam stocks subdued; currencies firm against weak greenback

03 Dec 2019

* Brazil real surges after better-than-expected GDP * Traders cautious after Trump says no trade deal deadline * EM currencies due for recovery - analyst By Ambar Warrick Dec 3 Most Latin American stock markets traded in a tight range on Tuesday, while currencies strengthened against a weak dollar, as comments by U.S. President Donald Trump sparked fears of a delay in the resolution to the Sino-U.S. trade war. Global equities dropped after Trump said a trade deal with China might be delayed until after the November 2020 U.S. presidential election. Possible U.S. duties on French goods also kept markets on edge. Investors had earlier expected an interim trade deal between Washington and Beijing by mid-November, but the prospect of a delayed conclusion now opens the door for further escalation in tensions that have dogged risk assets for more than a year. A basket of Latin American stocks moved in a flat-to-low range, with Brazilian and Chilean equities reflecting similar trades. "Trade headlines are certainly making for cautious trade in markets...the mood has certainly become less positive," said William Jackson, chief emerging markets economist at Capital Economics. "It's not a particularly big move one way or the other," he added, referring to Brazil's stock index. Regional currencies fared slightly better, with an index of local units rising about 0.1% against a weaker dollar, which held declines following disappointing manufacturing data from the United States on Monday. "The combination of a recovering global economy and softer U.S. is encouraging for USD weakness," Morgan Stanley said in a note, referring to stronger-than-expected manufacturing data from China on Monday. "We do expect to see further evidence of a global growth rebound going forward and believe this will help EM currencies to recover." Brazil's real surged as much as 0.8% after data showed the country's economy expanded at a faster-than-expected pace in the third quarter. Upward revisions to GDP figures for the first two quarters this year also meant that Latin America's largest economy steered further clear of recession than previously thought. The Chilean peso rose amid efforts by the country's central bank to shore up the currency, with an interest rate cut appearing likely this week, according to a Reuters poll. The Colombian peso fell about 0.1%, while the Mexican peso eased around 0.1%. Key Latin American stock indexes and currencies at 1428 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1037.69 -0.24 MSCI LatAm 2665.12 0.08 Brazil Bovespa 108640.25 -0.26 Mexico IPC 0.00 - Chile SPIPSA 4476.25 -0.56 Argentina MerVal 0.00 - Colombia Colcap 1598.33 - Currencies Latest Daily % change Brazil real 4.1972 0.38 Mexico peso 19.6041 -0.14 Chile peso 800.4 0.35 Colombia peso 3507.55 -0.13 Peru sol 3.391 0.00 Argentina peso (interbank) 59.9200 0.08 (Reporting by Ambar Warrick in Bengaluru Editing by Alistair Bell)

EMERGING MARKETS-Stocks slip as U.S. tariffs on Brazil, Argentina spark fresh trade woes

03 Dec 2019

Dec 3 Emerging market stocks dipped on Tuesday after the United States said it would restore tariffs on metal imports from Brazil and Argentina, raising concerns of yet another trade war for the world's largest economy.

EMERGING MARKETS-Brazil's real firms as c. bank sells dollars; shrugs off U.S. tariffs

02 Dec 2019

* Trump to restore tariffs on imports from Brazil, Argentina * Brazil stocks rise 1% after strong manufacturing data * Chilean peso firms as central bank intervention kicks in By Ambar Warrick Dec 2 Brazil's real firmed on Monday as a spot auction by the central bank supported the currency following a tweet by U.S. President Donald Trump that said he was restoring tariffs on metal imports from Brazil and Argentina. Without going into details, Trump said he would restore tariffs on U.S. steel and aluminum imports, surprising officials in the two South American countries and prompting them to seek explanations. The real eased 0.4% immediately after the tweet, but reversed course after the central bank sold 9,600 reverse currency swap contracts and $480 million in spot currency. The Argentine peso was largely unchanged, but the country's stock index fell about 1.7% after gaining for three days in a row. Aluminum producer Alua Aluminio Argentino led declines on the index. "We don't know what kind of response we're going to see (from Brazil and Argentina), but I suspect at this point it is more of a sell-the-news situation and then investors can settle back and interpret the data in a sober fashion," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia. A manufacturing rebound in China spurred optimism in Latin American markets, with the MSCI index tracking stocks in the region rising for the fourth straight session. Brazilian stocks hit a near one-month high after data showed the country's manufacturing sector grew in November, pointing to a steady recovery in Latin America's largest economy. Financials and material stocks were the biggest boosts to the Bovespa, while electronics retailer Via Varejo SA led gains after it flagged strong sales during the Black Friday discount shopping event. Focus now turns to Brazil's third quarter economic growth data, due Tuesday, which is likely to show an expansion of 0.4%, according to a Reuters poll. The Chilean peso firmed as the central bank's $20 billion currency intervention program kicked in. The bank had outlined the plan last week after the peso hit a record low against the dollar. The peso was also supported by higher prices for copper, Chile's largest export, as markets perceived increased demand for the metal following the stronger-than-expected Chinese data. Key Latin American stock indexes and currencies at 1505 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1038.95 -0.11 MSCI LatAm 2662.03 0.19 Brazil Bovespa 108904.90 0.62 Mexico IPC 42731.88 -0.21 Chile SPIPSA 4518.24 -0.45 Argentina MerVal 33868.37 -1.831 Colombia Colcap 1601.31 -0.66 Currencies Latest Daily % change Brazil real 4.2280 0.25 Mexico peso 19.5737 -0.06 Chile peso 806.2 -0.30 Colombia peso 3522.56 -0.20 Peru sol 3.4048 0.01 Argentina peso (interbank) 59.9500 -0.02 (Reporting by Ambar Warrick in Bengaluru; Additional reporting by Sruthi Shankar Editing by Alistair Bell)

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