EMERGING MARKETS-Brazil real outperforms on hopes of political change
By Bruno Federowski SAO PAULO, March 8 (Reuters) - The Brazilian real, sidestepping weak Chinese trade data, outperformed weaker Latin American currencies on Tuesday on hopes that a corruption scandal could trigger the ouster of unpopular President Dilma Rousseff. Many traders blame interventionist policies pursued by Rousseff and her predecessor Luiz Inacio Lula da Silva for driving Brazil into what could be its worst recession in decades. Over the last few months, Brazilian markets have often rallied whenever chances of a change in government seemed to grow. Traders said those odds increased sharply after Lula was detained for questioning on Friday in a federal investigation of a vast corruption scheme centered on state-controlled oil company Petroleo Brasileiro SA. Shares of Petrobras, as the company is known, were slightly higher despite a slump in crude oil prices . The benchmark Bovespa stock index fell slightly in volatile trade, pausing after six days of gains. "There has been a change in the tone of the market since last week," said José Carlos Amado, a trader with Spinelli brokerage in São Paulo. "Everybody used to be bearish, but now some see reason to buy reals." Political risk consultancy Eurasia Group estimated a 55 percent probability that Rousseff could be forced to step down before her term ends in 2018, according to a report. The real was the best performer among widely traded Latin American currencies, which fell after China's trade performance slumped in February. Imports by the world's biggest consumer of commodities fell for the 16th month in a row, while exports tumbled the most in over six years. Key Latin American stock indexes and currencies at 1540 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 787.91 -0.91 0.13 MSCI LatAm 2006.20 -1.55 11.37 Brazil Bovespa 49069.46 -0.36 13.19 Mexico IPC 44372.43 -1.32 3.25 Chile IPSA 3807.19 -0.8 3.45 Chile IGPA 18677.09 -0.67 2.90 Argentina MerVal 13175.75 -0.45 12.85 Colombia IGBC 9565.10 -1.39 11.91 Venezuela IBC 16333.70 0.11 11.96 Currencies daily % YTD % change change Latest Brazil real 3.7933 -0.04 4.05 Mexico peso 17.9050 -0.83 -3.77 Chile peso 682.9 -0.57 3.92 Colombia peso 3164.55 -1.60 0.15 Peru sol 3.4661 -0.43 -1.50 Argentina peso (interbank) 15.4600 -0.36 -16.03 Argentina peso (parallel) 15.63 0.64 -8.70 (Reporting by Bruno Federowski; Editing by Dan Grebler)
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