July 20, 2016 / 10:32 PM / 2 years ago

EMERGING MARKETS-Mexico shares hit high but U.S. rates hike fears hurt peso

(Updates with latest prices and market moves)
    By Bruno Federowski
    SAO PAULO, July 20 (Reuters) - Mexico's stock market rallied
for a fifth straight day on Wednesday, but its peso currency
weakened on concerns over higher U.S. interest rates.
    Worries that the U.S. Federal Reserve could raise rates as
soon as September after a muted market reaction to Britain's
decision to leave the European Union weighed on the Mexican
    But many traders would see higher Fed rates as evidence of
strength in the world's biggest economy, spelling good news for
Mexican companies since the country mainly exports to the United
    "Stock markets are brushing over the (Mexican) peso's
underperformance this year as signs that the U.S. economy is on
track to gain momentum," a trader focused on Latin America said
in New York.    
    The Mexican benchmark stock index rose 0.94 percent,
mostly helped by shares in billionaire Carlos Slim's America
Movil, which rose 1.97 percent and Grupo Financiero
Banorte which rose more than 2 percent.
    The Mexican peso  fell 0.98 percent relative
to Tuesday's reference price, to 18.68 pesos to the dollar.    
    Brazil's benchmark Bovespa fell as much 0.8 percent
on profit-taking following 10 straight daily gains, but later 
pared losses to about 0.21 percent.
    Stock indices in Chile and Colombia also fell.

    Key Latin American stock indexes at 2130 GMT:
 Stock indexes                Latest       Daily  YTD pct
                                             pct   change
 MSCI Emerging Markets           870.76      0.3     9.65
 MSCI LatAm                    2,399.78     0.77    31.15
 Brazil Bovespa               56,578.05    -0.21    30.51
 Mexico IPC                   47,505.25     0.94    10.54
 Chile IPSA                    4,108.70    -0.75    11.64
 Chile IGPA                   20,273.27    -0.63    11.69
 Argentina MerVal             15,931.79     0.62    36.46
 Colombia IGBC                 9,930.33    -0.18    16.18
 Venezuela IBC                12,497.78     1.91   -14.33
 (Reporting by Bruno Federowski; Editing by W Simon and Diane
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