EMERGING MARKETS-Brazil real, stocks rally on news Rousseff implicated in probe
(Updates prices) By Bruno Federowski SAO PAULO, March 3 (Reuters) - Brazil's stocks jumped by the most in six years and the real currency also rallied on Thursday on news that bolstered the case to impeach President Dilma Rousseff and bets the central bank could take longer to cut interest rates. The Brazilian stock market rose 5.4 percent, its largest one-day rally since October 2009, also helped by favorable corporate news. The real rose 2.4 percent, its biggest jump in nearly five months, outperforming regional peers. According to local media, Brazilian ruling party senator Delcidio do Amaral agreed to a plea bargain implicating Rousseff and her predecessor Luiz Inacio Lula da Silva in a graft scandal. Amaral declined to confirm the report. Analysts said the scandal bolsters the case for Rousseff's impeachment, encouraging investors who blame her Worker Party's interventionist policies for driving Brazil into what could be its deepest recession on record. "The market is betting Rousseff will not finish her mandate," said Pedro Tuesta, an economist with 4Cast in Washington D.C. The real, which closed at a three-month high of 3.7977 per dollar, was supported by the central bank's split decision to keep benchmark rates at 14.25 percent after markets closed on Wednesday. The split vote, with two of the eight members voting for a 50-basis-points increase, led traders to trim bets on a rate cut later this year or early next year. Inflation has been running at double-digits, way above the central bank's target range. Stock markets across the region also rose, with Mexico's IPC stock index hitting its highest in more than three months, following a return of risk appetite and a recovery in commodity prices. Key Latin American stock indexes and currencies at 2106 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 781.34 1.59 -3.15 MSCI LatAm 1970.49 3.72 3.82 Brazil Bovespa 47323.80 5.41 9.17 Mexico IPC 44742.22 0.28 4.11 Chile IPSA 3817.39 1.34 3.73 Chile IGPA 18707.96 1.38 3.07 Argentina MerVal 13327.87 0.8 14.16 Colombia IGBC 9548.46 0.94 11.71 Venezuela IBC 16267.34 0.11 11.51 Currencies daily % YTD % change change Latest Brazil real 3.8012 2.21 3.69 Mexico peso 17.9245 -0.53 -4.03 Chile peso 687 -0.12 3.20 Colombia peso 3190.26 0.46 -0.66 Peru sol 3.4621 0.86 -1.41 Argentina peso (interbank) 15.1550 3.22 -16.73 Argentina peso (parallel) 15.66 1.51 -9.74 (Reporting by Alonso Soto, additional reporting by Anna Yukhananov; Editing by Dan Grebler)
© Thomson Reuters 2016 All rights reserved.