November 8, 2019 / 7:26 PM / 8 days ago

EMERGING MARKETS-Latam stocks fall, Brazil's real set for worst week in a year

 (Updates prices, adds news items)
    By Agamoni Ghosh and Sruthi Shankar
    Nov 8 (Reuters) - Brazil's real led Latin American
currencies lower on Friday, hit by underwhelming oil auctions
and political concerns, while stocks in the region fell on
doubts about an agreement between Washington and Beijing to roll
back tariffs. 
    MSCI's index of Latin American currencies
fell nearly 1% as most currencies were thwarted by a stronger
dollar, with the real set for its worst week since August 2018.
    The steep declines come after major global oil companies 
snubbed Brazil's biggest-ever pre-salt oil auction earlier this
week.
    Adding to the real's woes was a decision by the country's
Supreme Court that could lead to the release of former President
Luiz Inacio Lula da Silva from prison, which could unite leftist
forces against the right-leaning government in power.
 
    "Lula may have the ability to unite the left side of the
political spectrum, thus increasing opposition to fiscal reforms
and austerity measures," said Simon Harvey, FX analyst at Monex
Europe.
    If released, Lula, 74, would be free to engage in politics
but not eligible under Brazil's Clean Record law to seek elected
office until 2025, eight years after his first conviction.
    All other major Latin American currencies were also set to
end the week lower with Chile's peso headed for its third
straight week of losses as the country reels with the
after-effects of its worst domestic unrest since the South
American nation's return to democracy in 1990.  
    MSCI's index of Latin American stocks fell
1.6% with most indexes in the red as conflicting trade headlines
kept investors on the back foot.
    The Bovespa fell 0.6% but still was on track to the
end the week higher, helped by some upbeat earnings. 
    Chile's SPIPSA index bucked the gloomy trend to
climb 0.3% higher, driven by shares of consumer-focused
companies. Data showed consumer prices in the country rose 0.8%
in October, slightly above market expectations. 
    
    Latin American stock indexes and currencies at 19:01 GMT  
    
 Stock indexes                                     daily %
                           Latest                   change
 MSCI Emerging Markets              1064.55          -0.84
                                             
 MSCI LatAm                         2747.77          -1.75
                                             
 Brazil Bovespa                   108444.72          -1.04
                                             
 Mexico IPC                        43744.56          -0.85
                                             
 Chile SPIPSA                       4689.90           0.37
                                             
 Argentina MerVal                  34202.55         -4.646
                                             
 Colombia IGBC                     13310.04          -1.21
                                             
                                                          
 Currencies                                        daily %
                                     Latest         change
 Brazil real                         4.1475          -1.31
                                             
 Mexico peso                        19.1001           0.07
                                             
 Chile peso                           746.3          -0.54
                                             
 Colombia peso                         3336          -0.60
 Peru sol                             3.359          -0.48
                                             
 Argentina peso                     59.5000           0.17
 (interbank)                                 
                                             
 

 (Reporting by Agamoni Ghosh and Sruthi Shankar)
  
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