EMERGING MARKETS-Latam stocks, currencies gain; rouble touches lows

viernes 14 de febrero de 2014 16:08 GYT

(Updates prices, adds details on Latin America, quote)

By Asher Levine and Sujata Rao

RIO DE JANEIRO/LONDON Feb 14 (Reuters) - Latin American stocks were set to deliver their best weekly performance in three months on Friday, boosted by strong earnings from key companies and resilient global risk appetite despite mixed economic data.

MSCI's Latin American stock index rose nearly two percent, helping the benchmark emerging equity index post its biggest daily gain this week.

While U.S. economic data came in mostly weaker than expected in recent days, including Friday's industrial production data, investors largely shrugged it off citing the impact of bad weather. Instead, traders were encouraged by strong trade data from China earlier in the week and signals from new U.S. Federal Reserve chief Janet Yellen that current monetary policy would remain on course.

"There is a little more risk appetite but I think it's momentary," cautioned Paulo Petrassi, an economist with Leme Investimentos in Florianopolis, Brazil, citing lingering risks of weaker economic growth in the U.S. and Brazil.

Data showed Brazilian economic activity fell sharply in December, raising the specter that Latin America's largest economy may have slipped into recession. Yields on Brazilian interest rate futures dropped on expectations the central bank would slow its monetary tightening cycle in order to support economic growth.

Brazil's real firmed, however, after central bank president Alexandre Tombini said Brazil is prepared to use international reserves if needed to curb volatility in the foreign exchange market.

"The real is still being pressured by Tombini's words yesterday," said Marco Trabbold, a trader with B&T in Sao Paulo.   Continuación...