EMERGING MARKETS-Latam stocks gain, currencies weaken after U.S. data
SAO PAULO, Sept 2 (Reuters) - Latin American currencies mostly weakened while stocks edged higher on Tuesday after encouraging U.S. manufacturing data strengthened the dollar and stoked risk appetite. The MSCI Latin American stock index erased the previous session's loss, with Brazil's Bovespa stock index adding nearly 1 percent. Data on Tuesday showed U.S. manufacturing activity increased to its highest level in nearly 3-1/2 years in August, boosting the outlook for global economic growth. Gains in the Bovespa were driven by some of the most widely-traded stocks such as lender Itau Unibanco Holding SA and oil producer Petroleo Brasileiro SA, known as Petrobras. Local shares with higher liquidity tend to attract global investors and often track global risk appetite. The Bovespa has swung on electoral polls in recent sessions, and tends to rise when the likelihood of President Dilma Rousseff winning a second term in October drops. New electoral polls are expected to be released on Wednesday. Other stock indexes in the region also rose, with Chile's IPSA driven by a nearly 2 percent gain in retailer Falabella and Mexico's IPC boosted by telecommunications firm America Movil. In currency markets, the Brazilian real weakened for the second straight day. "It's the same old story," said Reginaldo Siaca, head of currencies at brokerage Advanced in Sao Paulo. "Another round of good data from the U.S. and the emerging market (currencies) suffer." One exception was Chile's peso, which strengthened slightly due to higher prices for copper, the country's main export. Peru's nuevo sol was little changed. Data on Monday showed inflation in Peru unexpectedly shrunk by 0.09 percent in August on slipping electricity, fuel and transportation prices. "Inflation's rapid fall has tipped the inflation-growth trade-off now decidedly in favor of easing," wrote BNP Paribas economist Nader Nazmi in a client note on Tuesday. "We believe the central bank will cut its policy rate by an additional 25 basis points to 3.50 percent at its Sept. 11 meeting." Key Latin American stock indexes and currencies at 1743 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1086.46 -0.38 8.76 MSCI LatAm 3672.96 0.4 14.3 Brazil Bovespa 61707.21 0.93 19.80 Mexico IPC 45639.14 0.44 6.82 Chile IPSA 4053.64 1.04 9.58 Chile IGPA 19647.71 0.88 7.79 Argentina MerVal 10026.989 0.81 85.99 Colombia IGBC 14683.72 -0.06 12.34 Peru IGRA 17013.87 -0.06 8.00 Venezuela IBC 2621.55 -0.09 -4.20 Currencies daily % YTD % change change Latest Brazil real 2.2448 -0.02 4.99 Mexico peso 13.1092 -0.12 -0.60 Chile peso 589 0.36 -10.68 Colombia peso 1929.49 -0.52 0.13 Peru sol 2.852 -0.04 -2.07 Argentina peso (interbank) 8.4125 -0.06 -22.82 Argentina peso (parallel) 14.25 -0.35 -29.82 (Reporting by Bruno Federowski; Writing by Asher Levine; editing by Andrew Hay)
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