EMERGING MARKETS-Latam currencies rebound after U.S., Colombia data
By Asher Levine SAO PAULO, March 20 (Reuters) - Latin American currencies rebounded on Thursday while stock markets advanced as encouraging economic data in the U.S. and Colombia offset concerns over a sooner-than-expected increase in U.S. interest rates. The region's currencies sank late on Wednesday after U.S. Federal Reserve chief Janet Yellen suggested the central bank could increase interest rates "around six months" after it finishes unwinding its monetary stimulus program, a shorter time frame than many market participants had anticipated. Nearly every currency across Latin America strengthened against the dollar on Thursday, however, after the Philadelphia Federal Reserve Bank said its business activity index rose far more than expected in March. Local traders said the data helped feed risk appetite among global investors. Colombia's peso posted the region's strongest gains against the dollar after data showed the country's economy grew 4.3 percent in 2013, beating market expectations. Mexico's peso bounced up off an over six-week low hit in the previous session, though gains were slight. Mexican Finance Minister Luis Videgaray said on Thursday Mexico is well positioned to face market volatility and is working to maintain its flexible credit line with the International Monetary Fund. Local stocks mostly gained, with the MSCI Latin American stock index rallying for the fourth straight session. Brazil's Bovespa also advanced for a fourth day, putting it back into slightly positive territory for the month. The index has not seen a monthly gain since October as jitters over a weakening economy and an upcoming presidential election led investors to look for opportunities elsewhere. State-controlled companies such as oil producer Petroleo Brasileiro SA, electric utility Eletrobras and lender Banco do Brasil continued to post strong gains, with traders expecting an upcoming poll to show opposition candidates gaining on President Dilma Rousseff. Many investors have been critical of the Rousseff administration for heavy-handed government intervention in the private sector and policies that run against the interests of minority shareholders in state-controlled firms. Private-sector banks such as Banco Bradesco SA and Itau Unibanco Holdings SA also rose. Liquidity risks to Brazil's lenders should remain stable in the first half of 2014, central bank director Anthero Meirelles said on Thursday. Despite its mediocre performance over the past 12 months, the Bovespa is likely to move higher this year amid a global economic recovery, a Reuters poll showed, while Mexican shares will likely gain on the back of market reforms. Mexico's IPC index rose to a 39,300 points, a level it has not closed above since late February, led by a 2.6 percent gain in bottling firm Femsa. Chile's IPSA index was little changed, though shares of conglomerate Copec dropped 0.9 percent after the company reported a lower-than-expected quarterly profit. Key Latin American stock indexes and currencies at 1625 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 939.5 -1.17 -5.2 MSCI LatAm 2957.99 1 -8.5 Brazil Bovespa 47163.54 1.28 -8.43 Mexico IPC 39303.96 1.27 -8.01 Chile IPSA 3643.36 0.13 -1.51 Chile IGPA 18036.94 0.13 -1.04 Argentina MerVal 5981.6 1.95 10.95 Colombia IGBC 13048.44 0.15 -0.17 Peru IGRA 14442.6 -0.09 -8.32 Venezuela IBC 2559.5 -1.11 -6.47 Currencies daily % YTD % change change Latest Brazil real 2.3302 0.74 1.14 Mexico peso 13.244 0.31 -1.62 Chile peso 565.3 0.57 -6.93 Colombia peso 1992.54 0.84 -3.04 Peru sol 2.81 0.11 -0.60 Argentina peso (interbank) 7.9575 -0.06 -18.41 Argentina peso (parallel) 10.88 0.37 -8.09 (Editing by Meredith Mazzilli)
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