EMERGING MARKETS-Brazil markets jump as Neves gains momentum in election
SAO PAULO, Oct 13 (Reuters) - Brazilian financial markets shot higher on Monday as investors saw a higher likelihood of challenger Aecio Neves defeating President Dilma Rousseff in this month's election. Brazil's Bovespa stock index climbed its most in a week, while the nation's currency, the real , erased the previous session's losses. A survey of voter intentions by pollster Sensus released on Saturday showed Neves with about 58.8 percent support, versus 41.2 percent for Rousseff, ahead of the Oct. 26 runoff vote. Although recent polls from more widely watched research firms showed the two candidates were running neck and neck, traders seized on the data as a reason to pick up shares of state-run companies such as Petrobras. Preferred shares of the oil producer formally known as Petroleo Brasileiro SA jumped nearly 6 percent. Many investors believe a new administration would enact policies that are more favorable to minority shareholders in the company. Investors also cheered a formal endorsement of Neves by third-placed candidate Marina Silva on Sunday, which should improve his chances of defeating Rousseff. "This is all very good news for Aecio's campaign," said Joaquim Kokudai, a portfolio manager at Effectus Investimentos in Sao Paulo, adding that the market should show an even more positive reaction should future polls confirm Neves' advance. Yields on Brazilian interest rate futures <0#DIJ:> fell across the curve as the real strengthened about 1.4 percent. A Neves win is expected to lower Brazil's risk profile among global investors and increase demand for local assets. Elsewhere in Latin America, Chile's peso climbed alongside higher prices for copper, the country's main export, while Mexico's peso erased Friday's loss. Local currencies also received a boost after U.S. Federal Reserve officials on Saturday said the bank could delay an increase in U.S. interest rates if the global economy remains weak enough to warrant it. Colombia's financial markets were closed for the Columbus Day holiday. Key Latin American stock indexes and currencies at 1316 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 992.52 0.27 -1.28 MSCI LatAm 3271.85 2.79 -0.56 Brazil Bovespa 57304.87 3.6 11.26 Mexico IPC 43506.02 0.16 1.82 Chile IPSA 3848.07 0.42 4.02 Chile IGPA 18900.04 0.47 3.69 Argentina MerVal 10040.239 -1.6 86.24 Colombia IGBC - - - Peru IGRA 15547.16 0 -1.31 Venezuela IBC 2824.3 0 3.21 Currencies daily % YTD % change change Latest Brazil real 2.3935 1.22 -1.53 Mexico peso 13.4192 0.46 -2.90 Chile peso 588.5 0.59 -10.60 Colombia peso - - - Peru sol 2.904 0.00 -3.82 Argentina peso 8.4650 0.12 -23.30 (interbank) Argentina peso 14.9 -0.47 -32.89 (parallel) (Reporting by Asher Levine; Editing by Lisa Von Ahn)
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