July 25, 2016 / 3:42 PM / 2 years ago

EMERGING MARKETS-Latam currencies, stocks down ahead of Fed, BOJ policy meetings

By Bruno Federowski
    SAO PAULO, July 25 (Reuters) - Latin American currencies and
stocks fell on Monday as traders avoided risky bets ahead of
this week's Federal Reserve and Bank of Japan policy meetings.
    Though traders overwhelmingly bet the Fed will hold interest
rates steady on Wednesday, growing expectations that it could
tighten policy later this year weighed on appetite for
high-yielding assets.
    Hopes that Japan's central bank could unveil a fresh batch
of monetary stimulus on Friday did little to lift sentiment.
Bank of Japan Governor Haruhiko Kuroda said on Saturday he would
ease policy further if necessary. 
    "This is a busy week so caution is warranted," José Carlos
Amado, a trader with Spinelli brokerage in São Paulo, said.
    Currencies from oil-rich countries tumbled as crude prices
  slid to their lowest in 2-1/2 months on lingering
concerns of global oversupply and weak demand.
    The Mexican peso weakened 1 percent to an over two
week low, while the Colombian peso posted its sharpest
daily drop in a month.
    In stock markets, Brazil's Bovespa benchmark index 
fell 0.7 percent after rising for six weeks in a row, its
longest winning streak since 2010.
    Financials were among the biggest losers but shares of
state-owned lender Banco do Brasil SA rose after
Deutsche Bank analysts improved their recommendation for the
stock to "buy" from "hold."
    Shares of Petróleo Brasileiro SA also advanced
after the state-controlled oil company said it plans to sell
voting control of Petrobras Distribuidora SA. 
    A bidding round for a minority stake in the fuels retailer
had failed to attract bids that met the needs of Petrobras, as
the company is known. 

    Key Latin American stock indexes and currencies at 1530 GMT:
 Stock indexes                                daily %   YTD %
                                               change  change
 MSCI Emerging Markets                867.65    -0.19    9.46
 MSCI LatAm                          2366.37    -1.08   30.74
 Brazil Bovespa                     56623.70    -0.66   30.62
 Mexico IPC                         47381.51    -0.33   10.25
 Chile IPSA                          4133.07    -0.26   12.31
 Chile IGPA                         20409.14     -0.2   12.44
 Argentina MerVal                   15653.95    -1.21   34.08
 Colombia IGBC                       9802.69    -0.71   14.69
 Venezuela IBC                      12056.88    -3.42  -17.35
 Currencies                                   daily %   YTD %
                                               change  change
 Brazil real                          3.2868    -0.89   20.09
 Mexico peso                         18.7505    -1.07   -8.11
 Chile peso                            657.5    -1.08    7.94
 Colombia peso                        2997.8    -1.59    5.72
 Peru sol                              3.341    -0.60    2.18
 Argentina peso (interbank)          14.9450    -0.17  -13.13
 Argentina peso (parallel)             15.44    -0.06   -7.58

 (Reporting by Bruno Federowski; Additional reporting by Paula
Arend Laier; Editing by Meredith Mazzilli)
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