EMERGING MARKETS-Brazil currency, stocks slip as doubts follow protests
By Flavia Bohone SAO PAULO, March 14 (Reuters) - Brazil's currency and stock market fell on Monday following weekend demonstrations calling for the ouster of President Dilma Rousseff, with traders taking profits as the focus turned to questions about the strength of the political opposition. The Brazilian real dropped 1.0 percent and the benchmark Bovespa stock index lost 0.3 percent after surging nearly 10 percent and 20 percent respectively in the prior two weeks. The outlook for Rousseff has rapidly eroded. A corruption investigation is nearing her inner circle and her largest coalition partner has distanced itself from the government, boosting expectations of a more market-friendly administration ahead. The tough streak for Rousseff continued on Sunday with the largest in a series of anti-government rallies sweeping the streets of Brazil's biggest cities, confirming a growing appetite for change but raising doubts about what would follow. "Brazil continues to ride a wave of impeachment optimism, but we warn that this bullishness is likely overdone," BBH analysts said in a note to clients. Rousseff's opponents in Congress have tried to seize on the widespread discontent to mount a reform agenda, but crowds on Sunday appeared resistant to certain opposition leaders taking the spotlight. "We saw that people don't have a name to replace the Workers' Party government. The opposition was booed and the question remains, 'Who will replace this administration?'" said Joao Paulo de Gracia Correa, head of the regional currency desk for the SLW brokerage in Curitiba. Shares of state-run oil company Petroleo Brasileiro SA were among the biggest losers on the Bovespa, dropping 4 percent after a nearly 45 percent rally in the prior two weeks. Key Latin American stock indexes and currencies at 1430 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 804.17 0.41 0.85 MSCI LatAm 2071.39 -0.44 13.71 Brazil Bovespa 49513.14 -0.25 14.22 Mexico IPC 44748.26 0.03 4.12 Chile IPSA 3844.76 0.13 4.47 Chile IGPA 18839.07 0.12 3.79 Argentina MerVal 12864.07 -1.43 10.18 Colombia IGBC 9589.45 -0.68 12.19 Venezuela IBC 15767.07 -0.78 8.08 Currencies daily % YTD % change change Latest Brazil real 3.6247 -0.97 8.89 Mexico peso 17.8075 -0.60 -3.24 Chile peso 685 -0.26 3.61 Colombia peso 3179.65 -1.03 -0.33 Peru sol 3.368 -0.29 1.37 Argentina peso (interbank) 14.8000 0.47 -12.28 Argentina peso (parallel) 15.55 1.03 -8.23 (Reporting by Flavia Bohone; Additional reporting by Paula Laier; Writing by Brad Haynes; Editing by Dan Grebler)
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