EMERGING MARKETS-Brazil stocks gain on poll expectations; Embraer rises on orders
SAO PAULO, July 14 (Reuters) - Brazilian stocks rose on Monday as investors bet that Brazil's failure to win the soccer World Cup will lead to a decline in President Dilma Rousseff's approval ratings ahead of October elections. The broader MSCI Latin American stock index posted its biggest one-day rise in nearly a month, though most currencies in the region were little changed. Two Brazilian research firms are expected to release electoral polls this week. In the past, declines in Rousseff's approval rating have driven up shares of state-run enterprises, as many investors believe a new administration would enact policies that are more favorable to minority shareholders. "Brazil's elimination from the World Cup will shift attention back to the polls and the risk of declining support for Rousseff on what is still weak economic growth," wrote Siobhan Morden, head of Latin America strategy at Jefferies. Gains in Brazil's Bovespa stock index were led by a 4 percent gain in state-run oil producer Petroleo Brasileiro SA . The shares were further boosted after Goldman Sachs placed the shares on its "Latam Spotlight List" on Monday. Planemaker Embraer SA saw its shares reach an all-time high after the company said on Monday that it booked its strongest commercial deliveries in two years and rebuilt its order book with a 50-jet deal. Mexican shares rose their most in over a week, led by mining firm Grupo Mexico. Chilean stocks sank their most in over two weeks after the government lowered its forecast for 2014 gross domestic product growth to 3.2 percent from a prior view of 3.4 percent. The Chilean peso also weakened slightly on the news, while most other currencies in the region posted very slight gains. Brazil's real strengthened 0.27 percent against the dollar, though traders warned that any moves in the currency were likely to be kept in check by the central bank through market intervention. Many believe the bank is most comfortable with the real at the 2.20 to 2.25 per dollar level. Key Latin American stock indexes and currencies at 1618 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1063.01 0.41 5.58 MSCI LatAm 3473.36 1.17 7.26 Brazil Bovespa 55603.8 1.49 7.95 Mexico IPC 43804.46 0.74 2.52 Chile IPSA 3968.19 -0.16 7.27 Chile IGPA 19312.11 -0.03 5.95 Argentina MerVal 8789.579 -0.36 63.04 Colombia IGBC 13843.41 -0.54 5.91 Peru IGRA 17171.25 0.11 9.00 Venezuela IBC 2120.85 0 -22.50 Currencies daily % YTD % change change Latest Brazil real 2.2135 0.27 6.47 Mexico peso 12.9725 0.18 0.44 Chile peso 554 0.04 -5.04 Colombia peso 1857.2 0.01 4.03 Peru sol 2.783 0.14 0.36 Argentina peso (interbank) 8.1550 -0.06 -20.39 Argentina peso (parallel) 12 -0.17 -16.67 (Reporting by Asher Levine; Editing by Chizu Nomiyama)
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