EMERGING MARKETS-Brazil real seesaws ahead of Carnaval; U.S. job data weighs
By Bruno Federowski SAO PAULO, Feb 5 (Reuters) - The Brazilian real seesawed on Friday as traders closed positions ahead of the local Carnaval holiday and digested a batch of mixed U.S. job data. The real turned positive for the year against the U.S. dollar this week, boosted by a recovery in global sentiment and bets that the U.S. Federal Reserve could avoid raising rates until 2017. Traders also cited talk of action by Brazilian public banks to stymie currency weakness. Investors were reluctant to stick to bets that this rebound would last going into the extended weekend. Brazilian markets will be closed Monday and Tuesday and will reopen on Wednesday. "You don't want to be exposed for four whole days," said José Carlos Amado, a trader at Spinelli brokerage in São Paulo. The country's Bovespa stock index rose for a third day, supported by shares of Itau Unibanco Holding SA, BRF SA and Ambev SA. Other Latin American currencies weakened after data showed a lower U.S. unemployment rate in January and higher wages, though job creation slowed. Some traders said the figures put a 2016 interest rates increase back on the table, which could draw funds away from high-yielding emerging market assets. "Although there is more talk of recession in the U.S., this is still not the kind of data one associated with an economic contraction," wrote BBH analysts in a client note. "While we have doubted the Fed's four-hike call, we think the market is similarly extreme in not fully pricing in a single hike this year." Latin American stock indexes and currencies at 1455 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 740.44 0.12 -6.87 MSCI LatAm 1769.92 -0.8 -2.5 Brazil Bovespa 40994.78 0.42 -5.43 Mexico IPC 43513.32 -0.55 1.25 Chile IPSA 3662.37 -0.11 -0.48 Chile IGPA 18011.61 -0.09 -0.77 Argentina MerVal 11504.97 0.72 -1.46 Colombia IGBC 8637.44 -0.37 1.05 Venezuela IBC 14379.55 -1.98 -1.43 Currencies daily % YTD % change change Latest Brazil real 3.8953 -0.06 1.33 Mexico peso 18.3820 -0.58 -6.27 Chile peso 701 -0.54 1.24 Colombia peso 3332 -0.54 -4.88 Peru sol 3.4821 -0.17 -1.96 Argentina peso (interbank) 14.2300 0.07 -8.77 Argentina peso (parallel) 14.2 0.42 0.49 (Reporting by Bruno Federowski; Editing by Bernadette Baum)
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