July 29, 2016 / 3:57 PM / 2 years ago

EMERGING MARKETS-Brazil real jumps on U.S. data; stocks seesaw on corporate news

By Bruno Federowski and Paula Arend Laier
    SAO PAULO, July 29 (Reuters) - The Brazilian real
strengthened more than its Latin American peers on Friday as the
central bank refrained from intervening to curtail a rally
triggered by lower expectations of U.S. rate increases this
    Stock markets seesawed following a heavy batch of corporate
updates, with shares of Petróleo Brasileiro SA up after the
state-controlled oil company sold off a $2.5 billion stake in an
offshore exploration license.
    The U.S. economy grew far less than expected in the second
quarter, leading many investors to roll back bets on a near-term
rate hike by the Federal Reserve. 
    Keeping U.S. rates lower for longer would maintain the
allure of high-yielding emerging market assets, lifting
currencies from Latin America.
    The Brazilian real jumped about 2 percent,
outperforming other currencies in the region. Even so, Brazil's
central bank abstained from acting to weaken the currency
despite doing so almost daily in July.
    The country's benchmark Bovespa stock index rose in
volatile trade.
    Shares in Petrobras, as the oil company is known, ranked
among the biggest boosts to the index after it agreed to sell a
66 percent stake in the key Carcará field to Norway's Statoil
    The sale is the first in a $15 billion divestment program as
Petrobras seeks to cut debt and revive investor confidence amid
a sweeping graft scandal.
    Shares of food processor BRF SA posted their
biggest daily gain in more than two months despite a tumble in
second-quarter profit. In a conference call, executives said
they could raise prices in the second half of 2016 in order to
boost profitability. 
    Planemaker Embraer SA led the losses, falling to
its lowest in three and a half years. The company reported an
unexpected quarterly loss, cut its outlook for executive jet
sales this year and set aside provisions to settle a U.S. graft
    Key Latin American stock indexes and currencies at 1530 GMT:
 Stock indexes                                daily %   YTD %
                                     Latest    change  change
 MSCI Emerging Markets                874.04    -0.17   10.25
 MSCI LatAm                          2376.91     0.98   28.63
 Brazil Bovespa                     56866.00     0.35   31.18
 Mexico IPC                         46450.64    -0.82    8.08
 Chile IPSA                          4122.43    -0.41   12.02
 Chile IGPA                         20391.86    -0.33   12.34
 Argentina MerVal                   15731.71     1.78   34.74
 Colombia IGBC                       9716.55    -0.05   13.68
 Venezuela IBC                      12458.70     0.55  -14.60
 Currencies                                   daily %   YTD %
                                               change  change
 Brazil real                          3.2358     1.84   21.98
 Mexico peso                         18.7700     0.64   -8.20
 Chile peso                            652.8     1.64    8.72
 Colombia peso                       3070.04     0.59    3.23
 Peru sol                              3.351     0.00    1.88
 Argentina peso (interbank)          15.0625    -0.13  -13.81
 Argentina peso (parallel)             15.39     0.84   -7.28
 (Reporting by Bruno Federowski and Paula Arend Laier; Writing
by Bruno Federowski; Editing by David Gregorio)
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