EMERGING MARKETS-Latam markets ease lower on China worries, commods prices
SAO PAULO, Aug 18 (Reuters) - Latin American financial markets fell modestly on Tuesday after a sharp drop in China's stock market raised fears over slowing economic growth and weaker purchasing power in one of the region's top trade partners. Every major Latin American currency weakened against the dollar, while the MSCI Latin American stock index extended recent losses, touching its lowest level since early 2009. Chinese stocks fell more than 6 percent as the yuan weakened against the dollar, raising fears that Beijing may further devalue the currency. Such a move could decrease China's consumption and import levels. China is Brazil's top trade partner and a major purchaser of Latin American raw materials such as iron ore, petroleum, soybeans and copper. Chile's peso posted the biggest loss among the region's currencies as the price of copper, the country's main export, extended its three-month decline. "The fall in China's markets today is rekindling risk aversion once again," said Joao Paulo de Gracia Correa, a trader with brokerage SLW in Sao Paulo. Brazil's real weakened slightly but was unable to break the 3.50 per dollar resistance level. In equities markets, Brazil's Bovespa stock index fell for the sixth straight day as investors sold off shares of widely traded companies such as lender Itau Unibanco SA and state-run oil producer Petroleo Brasileiro SA , known as Petrobras. Such shares tend to attract foreign investors looking for exposure to Brazilian assets and often track global risk appetite. Mexico's IPC stock index and Chile's IPSA stock index both fell about 0.35 percent. Key Latin American stock indexes and currencies at 1431 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 846.62 -0.95 -10.62 MSCI LatAm 2118.61 -1.26 -21.34 Brazil Bovespa 46703.6808 -1.09 -6.61 1 Mexico IPC 43798.72 -0.35 1.51 Chile IPSA 3772.41 -0.35 -2.04 Chile IGPA 18436.75 -0.16 -2.30 Argentina MerVal 11316.659 -1.19 31.91 Colombia IGBC 9634.37 -0.75 -17.19 Venezuela IBC 14912.99 -1.18 286.47 Currencies daily % YTD % change change Latest Brazil real 3.4875 -0.18 -23.80 Mexico peso 16.433 -0.04 -10.28 Chile peso 697.8 -1.15 -13.10 Colombia peso 3003.3 -0.29 -20.49 Peru sol 3.2481 -0.16 -8.28 Argentina peso 9.2450 -0.03 -7.52 (interbank) Argentina peso 15.05 -0.53 -6.98 (parallel) (Reporting by Asher Levine and Bruno Federowski; Editing by Meredith Mazzilli)
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