August 15, 2018 / 2:54 PM / in a month

EMERGING MARKETS-Turkey woes cause LatAm sell-off; emerging mkt stocks enter bear market

    SAO PAULO, Aug 15 (Reuters) - Latin American equities and
currencies slid across the board on Wednesday, as continued
jitters about Turkey's lira currency helped boost the dollar,
sparking a global sell-off in emerging market assets and
commodities.
    The lira, a major focus for markets in recent
days, bounced as much as 8 percent as authorities tightened the
screws on foreign investors aiming to short the currency. But,
having firmed beyond 6 per dollar, most early gains fizzled out.

    That pushed risk-averse traders toward the dollar, prompting
a shakeout in riskier assets. The widely watched MSCI Emerging
Markets Equity Index entered a technical bear market
after falling some 20 percent since late January, while the MSCI
emerging market currency index hit 13-month
lows.
    In Latin American equities markets, Brazil's benchmark
Bovespa index was the biggest loser, falling 1.8 percent
in morning trade, as mediocre corporate results and domestic
political worries added to the wider sell-off.
    "Local investors started the day evaluating the re-emergence
of caution overseas with stock markets falling and emerging
market currencies also falling against the dollar," as the
Turkey situation develops, said Regis Chinchila, an analyst at
Sao Paulo-based Terra Investimentos.
    Education companies Kroton Educacional SA and
Estacio Participacoes SA both fell over 3 percent
after reporting disappointing second-quarter results. Heavily
weighted state oil company Petroleo Brasileiro SA and
iron ore miner Vale SA both fell at least 2.5 percent
as commodities prices fell, helping drag down the index as a
whole.
    Chinchila said traders were also eyeing a poll released on
Wednesday, which showed market-friendly centrist Geraldo Alckmin
failing to gain traction for Brazil's October presidential
election.
    In currency markets, Brazil's real and the Colombian
and Argentine pesos all fell at least 1
percent at one point on Wednesday morning.
    The biggest loser was Mexico's peso, which dropped 1.59
percent against the dollar in morning trade, its biggest
intraday fall since early June. The peso has strengthened
significantly in the last two months amid perceived progress in
North American Free Trade Agreement negotiations, but the
currency has been hit particularly hard by the emerging market
jitters in recent days.
    
Key Latin American stock indexes and currencies at 1419 GMT:
    
 Stock indexes                           daily %     YTD %
                             Latest       change    change
 MSCI Emerging Markets         1022.28     -1.95       -10
                                                  
 MSCI LatAm                    2538.06        -2     -8.43
                                                  
 Brazil Bovespa               77393.41     -1.54      1.30
                                                  
 Mexico IPC                   48723.84     -0.76     -1.28
                                                  
 Argentina MerVal             26536.63         0    -11.74
                                                  
 Colombia IGBC                11934.03     -0.78      4.95
                                                  
 Venezuela IBC               140445.22      0.21  11018.74
                                                  
                                                          
 Currencies                              daily %     YTD %
                                          change    change
                                Latest            
 Brazil real                    3.9057     -1.02    -15.17
                                                  
 Mexico peso                   19.1920     -1.59      2.64
                                                  
 Chile peso                      663.3      0.00     -7.33
                                                  
 Colombia peso                  3042.3     -1.01     -1.98
 Peru sol                        3.321     -0.66     -2.53
                                                  
 Argentina peso                30.1000     -0.76    -38.21
 (interbank)                                      
                                                  
 Argentina peso                   29.2      1.71    -34.14
 (parallel)                                       
                                                  
 

 (Reporting by Gram Slattery and Paula Arend Laier; additional
reporting by Sujata Rao in London; editing by Jonathan Oatis)
  
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