September 12, 2019 / 2:48 PM / 5 months ago

EMERGING MARKETS-Latam stocks hit 1-mth high on U.S-China tariff delay, ECB stimulus

    By Ambar Warrick
    Sept 12 (Reuters) - Latin American stocks hit a one-month
high on Thursday as conciliatory trade measures by the United
States and China aided risk appetite, spurring inflows into
emerging markets.
    U.S. President Donald Trump delayed an increase in tariffs
on Chinese goods by two weeks, after China exempted some U.S.
drugs and other goods from tariffs. The moves underpinned
optimism over meaningful headway being made in trade talks
scheduled in October.
    "The goodwill shown by both the U.S. and China lifted the
market, a combination of light positioning, cheap valuation and
the stability of the Chinese yuan could help emerging markets to
recover," said Morgan Stanley strategists in a note.
    "We think some emerging market high yielders will do well in
the near term."
    The European Central Bank's interest rate cut and outlining
of stimulus measures on Thursday also spurred buying, on
expectations of other major economies resorting to similar
    Investors will now look to moves from the U.S. Federal
Reserve and the Brazilian central bank next week. 
    MSCI's Latin American stocks index tacked on
about 0.8%, notching a one-month peak, propped up by
benchmark-heavy Brazilian shares.
    The Sao Paulo. index rose 0.4% on broad-based gains,
with telecom stocks marking large gains after the Brazilian
Senate approved a bill to modernize telecommunication laws and
boost companies in the sector.
    Telefonica Brasil SA added about 2%.
    Mexican and Chilean stocks rose 0.4% and
0.2%, respectively.
    MSCI's index of Latin American currencies
touched a near one-month high, with the Brazilian real
and Mexican peso adding about 0.5% and 0.3%,
    Argentina's peso opened steady after the country
announced further control measures requiring anyone buying
foreign currency to present a sworn oath promising to wait at
least five days before using it to purchase bonds. 
    These measures come after the peso saw its worst month ever
in August following a stunning upset for President Mauricio
Macri by opposition leader Alberto Fernandez in the country's
primary elections, which raised concerns of an interventionist
government being voted in.
    Latin American stock indexes and currencies at 1426 GMT
 Stock indexes                           Daily % change
 MSCI Emerging Markets         1025.42             0.82
 MSCI LatAm                    2721.63             0.88
 Brazil Bovespa              104093.67             0.63
 Mexico IPC                   42920.16              0.4
 Chile IPSA                    4969.61              0.3
 Argentina MerVal             28507.16           -0.387
 Colombia IGBC                12910.44             0.21
 Currencies                              Daily % change
 Brazil real                    4.0420             0.54
 Mexico peso                   19.4449             0.30
 Chile peso                     711.05             0.65
 Colombia peso                  3353.1             0.63
 Peru sol                       3.3268             0.34
 Argentina peso                56.2600            -0.14

 (Reporting by Ambar Warrick in Bengaluru; Editing by Giles
Nuestros Estándares:Los principios Thomson Reuters
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