EMERGING MARKETS-Colombian markets fall, Brazil up after local votes
By Bruno Federowski SAO PAULO, Oct 3 (Reuters) - Colombia's stocks and currency fell on Monday after voters rejected a peace deal with Marxist FARC rebels, while Brazilian markets rose following municipal elections. Many traders fear the Colombian vote could make it harder for President Juan Manuel Santos' administration to gather support for tax reform, a measure seen as crucial to maintain the country's debt rating. The government planned to unveil its tax reform plans to lawmakers by Oct. 10, seeking to increase revenue by between 1 percent and 2 percent of gross domestic product. "It will be prudent to see how the dust settles, but the market will likely price-in the risk of a downgrade to Colombia's BBB rating," J.P.Morgan analysts wrote in a report. The Colombian peso weakened nearly 2 percent, eyeing its biggest daily loss since Sept. 9, while the IGBC stock index slipped 0.5 percent. Brazilian stocks and the real currency both rose as traders bet Brazil's President Michel Temer could find it easier to approve painful fiscal measures in Congress after Sunday's municipal elections. Political parties implicated in the Petrobras corruption scandal suffered major setbacks in the elections and the leftist Workers Party (PT), which has been spearheading efforts against Temer's plans to cut spending, was the worst hit. The Brazil equities rally was widespread, with all but three stocks included in the benchmark Bovespa index in the black. Blue-chip stocks such as lenders Itaú Unibanco Holding SA and Bradesco SA, as well as state-controlled oil company Petróleo Brasileiro SA provided the biggest boosts to the index. Key Latin American stock indexes and currencies at 1555 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 910.04 0.73 13.77 MSCI LatAm 2399.56 0.79 30.11 Brazil Bovespa 59180.70 1.39 36.52 Mexico IPC 47200.42 -0.1 9.83 Chile IPSA 4022.76 0.19 9.31 Chile IGPA 20081.12 0.17 10.63 Argentina MerVal 16724.97 0.29 43.25 Colombia IGBC 9793.99 -0.54 14.59 Venezuela IBC 13104.02 1.1 -10.17 Currencies daily % YTD % change change Latest Brazil real 3.2356 0.46 21.99 Mexico peso 19.3475 0.13 -10.94 Chile peso 658.5 -0.21 7.78 Colombia peso 2936.24 -1.84 7.94 Peru sol 3.39 -0.27 0.71 Argentina peso (interbank) 15.1600 1.02 -14.36 Argentina peso (parallel) 15.61 0.64 -8.58 (Reporting by Bruno Federowski; Editing by Andrew Hay)
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