July 6, 2016 / 8:37 PM / 2 years ago

EMERGING MARKETS-Latam stocks fall as Brexit woes linger

(Updates prices, adds Mexico)
    By Bruno Federowski
    SAO PAULO, July 6 (Reuters) - Latin American stocks fell on
Wednesday as traders continued to fret about Britain's decision
to leave the European Union.
    Financial market volatility stemming from Britain's June 23
referendum raised worries about global financial stability,
putting central banks on alert.
    Mexico's benchmark IPC stock index fell for a third
straight day to a weekly low on wider global risk aversion,
which also dragged down the stock market in Chile.
    However, several currencies of key commodity exporters
recovered from declines earlier in the day after oil prices rose
 almost 2 percent, reacting to data showing strong growth in the
U.S. services sector. 
    Higher crude prices helped support the Mexican peso 
on Wednesday, which inched up 0.2 percent. The currency had
declined for three consecutive trading days, even after the
central bank raised its key interest rate aggressively last
    The Brazilian real was the biggest loser in Latin
America, as the central bank resorted to purchasing dollars in
futures markets after the currency closed June with its biggest
monthly advance in 13 years.
    Also pressuring demand for Brazilian assets were concerns
interim President Michel Temer's government could announce an
unambitious fiscal target for 2017.
    "If next year's primary deficit looks like this year's, it
will be horrendous. It would raise doubts about a lack of fiscal
effort," said Arnaldo Curvello, Ativa brokerage head of asset
    Key Latin American stock indexes and currencies at 1953 GMT:
 Stock indexes               Latest          Daily   YTD pct
                                               pct    change
 MSCI Emerging Markets            820.86      -1.3      4.73
 MSCI LatAm                     2,202.94     -1.21     21.87
 Brazil Bovespa                51,894.57       0.1     19.71
 Mexico IPC                    45,308.02     -1.12      5.42
 Chile IPSA                     3,995.66     -0.56      8.57
 Chile IGPA                    19,740.84     -0.43      8.76
 Argentina MerVal              14,647.45     -1.07     25.46
 Colombia IGBC                  9,735.67       0.5     13.90
 Venezuela IBC                 11,785.33     -5.77    -19.21
 Currencies                       Latest     Daily   YTD pct
                                               pct    change
 Brazil real                      3.3366     -1.12     15.46
 Mexico peso                     18.7825      0.17     -9.01
 Chile peso                        662.2      0.05      6.69
 Colombia peso                   2,999.5     -0.62      5.36
 Peru sol                          3.281      0.09      3.90
 Argentina peso (interbank)      14.6900      0.76    -13.15
 Argentina peso (parallel)         14.86      0.93     -4.13
 (Reporting by Bruno Federowski; Additional reporting by Flavia
Bohone, Paula Arend Laier and Anna Yukhananov; Editing by
Frances Kerry and Steve Orlofsky)
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