EMERGING MARKETS-Brazil's Bovespa extends rally on election outlook; Oi, TIM soar
SAO PAULO, Aug 27 (Reuters) - Brazil's benchmark Bovespa stock index rose to its highest level in 19 months on Wednesday after two polls suggested President Dilma Rousseff may lose her re-election bid in October. The broader MSCI Latin American stock index rose its most in over two weeks, while the region's currencies were mixed. A widely watched poll released on Wednesday showed Rousseff losing to environmentalist Marina Silva in an expected runoff, echoing the results of another poll released late on Tuesday. Many investors have accused Rousseff of mismanaging the economy and have criticized her for enacting policies detrimental to minority shareholders of state-run companies such as oil producer Petroleo Brasileiro SA, known as Petrobras. Petrobras preferred shares rose 4.5 percent on Wednesday and are up about 22.5 percent over the past nine sessions as Rousseff's chances continue to dim. The index was also boosted by shares of telecommunications firms Grupo Oi SA and TIM Participacoes SA . The shares soared after Grupo Oi announced it had hired investment bank Grupo BTG Pactual SA to advise on a plan to win control of TIM. In currency markets, the Brazilian real strengthened for a second straight day against the dollar, as traders see a non-Rousseff government reducing the country's risk profile among global investors. Chile's peso fell for the second straight session, partially due to lower prices for copper, the country's main export. Chile's central bank is expected to continue with its easing cycle next month, cutting the benchmark interest rate 25 basis points to 3.25 percent, according to the prevailing view of traders in a central bank poll published on Wednesday. The Mexican peso strengthened slightly against the dollar after data on Wednesday showed a rebound in Mexican factory exports in July, raising hopes for a strengthening recovery in Latin America's second-largest economy. Key Latin American stock indexes and currencies at 1724 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1094.46 0.62 8.49 MSCI LatAm 3629.54 1.69 11.51 Brazil Bovespa 61078.13 2.1 18.58 Mexico IPC 45574.45 0.24 6.66 Chile IPSA 3962.54 0.28 7.12 Chile IGPA 19285.64 0.28 5.81 Argentina MerVal 9844.71 3.38 82.61 Colombia IGBC 14532.12 0.56 11.18 Peru IGRA 16990.77 0.29 7.85 Venezuela IBC 2596.45 2.45 -5.12 Currencies daily % YTD % change change Latest Brazil real 2.2584 0.23 4.36 Mexico peso 13.0784 0.14 -0.37 Chile peso 589.8 -0.64 -10.80 Colombia peso 1929.14 0.15 0.15 Peru sol 2.842 -0.21 -1.72 Argentina peso (interbank) 8.4025 0.03 -22.73 Argentina peso (parallel) 14.4 -1.39 -30.56 (Reporting by Bruno Federowski; Writing and additional reporting by Asher Levine; Editing by Jonathan Oatis)
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