July 6, 2017 / 3:59 PM / a year ago

EMERGING MARKETS-Brazil markets down on political woes; power utilities soar

    By Bruno Federowski
    SAO PAULO, July 6 (Reuters) - Brazil's stocks and currency
slipped on Thursday on lingering concerns over a political
crisis, but shares of power utilities rallied due to a planned
regulatory overhaul of the sector.
    Demand for Brazilian assets has fizzled in recent months as
traders feared a corruption scandal could delay the
implementation of President Michel Temer's ambitious agenda,
which is seen as critical to fuel long-term economic growth.
    The Brazilian real weakened 0.4 percent, the biggest
decliner among Latin American currencies, which were mostly
flat. The Colombian peso, however, strengthened 0.3
percent, tracking rising crude oil futures.
    Brazil's benchmark Bovespa stock index fell 0.7
percent, weighed down by blue-chips such as lender Itaú Unibanco
Holding SA and beverage producer Ambev SA.
Shares of miner Vale SA also fell on the back of
lower iron ore prices.
    Still, the index's losses were limited by a rally in shares
of power utilities after the government announced that plans to
overhaul power sector rules could lead to higher rates and lower
    Shares of state-controlled utility Centrais Elétricas
Brasileiras SA, or Eletrobras, which would benefit
directly from the revamp, soared as much as 15 percent, their
biggest daily increase in four years.
    Wider emerging markets mostly weakened, extending
Wednesday's selloff triggered by proposals to nationalize South
Africa's central bank. The South African rand held near
seven-week lows even as the central bank tried to calm
investors' nerves by stressing its independence was enshrined by
the constitution regardless of ownership.
    Key Latin American stock indexes and currencies at 1535 GMT:
 Stock indexes                                daily %    YTD %
                                               change   change
 MSCI Emerging Markets               1006.66    -0.32    17.12
 MSCI LatAm                          2539.50    -0.29     8.81
 Brazil Bovespa                     62706.88    -0.71     4.12
 Mexico S&P/BVM IPC                 50063.88    -0.47     9.69
 Chile IPSA                          4820.42    -0.58    16.12
 Chile IGPA                         24116.97    -0.51    16.32
 Argentina MerVal                   22487.48     0.24    32.92
 Colombia IGBC                      11024.10     0.06     8.85
 Venezuela IBC                     122973.02    -0.54   287.86
 Currencies                                   daily %    YTD %
                                               change   change
 Brazil real                          3.3063    -0.44    -1.73
 Mexico peso                         18.3280    -0.13    13.18
 Chile peso                            665.8    -0.02     0.74
 Colombia peso                        3074.6     0.27    -2.38
 Peru sol                              3.255     0.06     4.88
 Argentina peso (interbank)          17.1000     0.29    -7.16
 Argentina peso (parallel)             17.26    -0.29    -2.55

 (Reporting by Bruno Federowski; Editing by Lisa Von Ahn)
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