EMERGING MARKETS-Latam stocks, currencies soar on strong China imports data
By Bruno Federowski SAO PAULO, June 8 (Reuters) - Latin American stocks and currencies soared on Wednesday as stronger-than-expected Chinese trade data added fuel to a rally driven by shrinking expectations of near-term U.S. rate increases. Imports by the world's biggest consumer of commodities fell only 0.4 percent from a year earlier in May, the smallest decline since November 2014. Economists polled by Reuters had estimated a 6 percent drop. The data lifted prices of basic products across the board, boosting demand for currencies from materials-heavy regions such as Latin America. Crude oil extended its rally to eight-month highs, also helped by supply disruptions in Nigeria. Oil-heavy Colombia's peso strengthened for a fifth consecutive day, while the Mexican peso advanced 1.2 percent. Emerging market currencies have found support in weak U.S. data and comments by U.S. Federal Reserve Chair Janet Yellen that dashed bets on an interest rate hike as soon as this month. Brazil's real currency jumped on Wednesday to its strongest in more than 10 months, past 3.40 to the greenback, surprising many traders who believed the central bank would not allow the currency to strengthen further. Ilan Goldfajn, who was approved to become head of the country's central bank on Tuesday, defended the floating exchange rate, triggering a rally in the Brazilian currency. Expectations of capital inflows stemming from a $1.25 billion bond issue by Vale SA, the miner's first international sale in over three years, also supported the real. Ativa brokerage trader Arlindo Sá said the real could strengthen further if Brazil's political crisis cools. Scandals involving key officials in interim President Michel Temer's administration have sparked concerns over his ability to pass tough austerity measures in Congress. Brazil's benchmark Bovespa stock index rose, supported by shares of state-controlled oil company Petróleo Brasileiro SA. Petrobras, as the company is known, has kicked off the sale of a network of liquefied natural gas terminals and thermal power plants as part of efforts by the indebted firm to cut debt. "This is another important step in the company's deleveraging plans," Guide Investimentos analysts wrote in a client note. Key Latin American stock indexes and currencies at 1410 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 843.47 0.91 5.26 MSCI LatAm 2206.19 3.03 17.03 Brazil Bovespa 51238.67 1.49 18.20 Mexico IPC 46384.68 0.56 7.93 Chile IPSA 4033.88 0.48 9.61 Chile IGPA 19870.71 0.44 9.47 Colombia IGBC 9904.68 0.88 15.88 Venezuela IBC 15430.40 -0.94 5.77 Currencies daily % YTD % change change Latest Brazil real 3.3996 1.42 16.10 Mexico peso 18.1540 1.13 -5.09 Chile peso 671.9 0.98 5.63 Colombia peso 2894.47 1.61 9.49 Peru sol 3.2739 0.83 4.28 Argentina peso (interbank) 13.8600 -0.14 -6.33 Argentina peso (parallel) 14.14 0.14 0.92 (Reporting by Bruno Federowski; Editing by Dan Grebler)
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