May 10, 2018 / 8:52 PM / a year ago

EMERGING MARKETS-Argentina stocks surge as Wall St, oil lift Latam markets

 (Updates prices)
    SAO PAULO, May 10 (Reuters) - Argentine equities rallied on
Thursday, while the country's peso currency was stable, as the
central bank sold foreign currency reserves in the spot market
for the first time since the country announced it was seeking
financing from the International Monetary Fund.
    Across the region, other major markets such as Mexico and
Brazil also saw their equities and currencies markets jump,
supported by a solid day on Wall Street, oil prices that remain
high in the face of fresh U.S. sanctions on Iran, and a slew of
positive corporate earnings reports.
    Argentina's Treasury Minister Nicolas Dujovne was set to
meet with IMF Managing Director Christine Lagarde in Washington
after meeting on Wednesday with IMF Western Hemisphere Director
Alejandro Werner.
    Finance Minister Luis Caputo said the IMF deal would
guarantee financing through the end of President Mauricio
Macri's first term in December 2019 at a "very good" interest
rate of around 4 percent.
    On Wednesday, Argentina's Congress passed a capital markets
reform bill, seeking to boost the economy by reducing the power
of market regulators and loosening restrictions on some funds
investing in the country.
    "After the announcement to request financial help from the
IMF ... local stocks were able to take a breather after the
recent downturn and rebounded, taking advantage of the approval
of the capital markets law," said Gustavo Ber, a partner at
Buenos Aires consultancy Estudio Ber.
    Argentina's benchmark Merval index climbed around 6
percent on Thursday, after rising a similar amount on Wednesday.
That followed a 12 percent rout over the previous 12 sessions.

    Energy stocks in particular helped support the index, after
crude oil prices rose, triggered by potential disruption to oil
flows from major exporter Iran in the face of U.S. sanctions.
While oil prices moderated amid profit booking on Thursday,
prices remain high.
    In Brazil, where the Bovespa index gained 1.74
percent, shares in state-controlled oil company Petroleo
Brasileiro SA jumped 3.91 percent after Bank of
America elevated its rating on the stock to "buy" from
    The MSCI Emerging Markets Latin America Index, which puts
together a cross-section of large- and mid-cap stocks from five
major economies in the region, climbed 2.75 percent.
Key Latin American stock indexes and currencies at 2035 GMT:  
 Stock indexes                           daily %     YTD %
                             Latest       change    change
 MSCI Emerging Markets         1159.65      1.39     -1.27
 MSCI LatAm                    2896.77      2.75     -0.32
 Brazil Bovespa               85734.76      1.74     12.22
 Mexico IPC                   46573.16       0.6     -5.64
 Chile IPSA                    5710.45      0.82      2.62
 Chile IGPA                   28819.98      0.88      3.00
 Argentina MerVal             29547.15      5.87     -1.72
 Colombia IGBC                12391.55     -0.42      8.98
 Venezuela IBC                18449.93      4.02    -41.81
 Currencies                              daily %     YTD %
                                          change    change
 Brazil real                    3.5463      1.35     -6.57
 Mexico peso                   19.2340      1.84      2.42
 Chile peso                     623.61      1.56     -1.44
 Colombia peso                 2825.07      1.30      5.55
 Peru sol                        3.266      0.89     -0.89
 Argentina peso                22.6900      0.13    -18.03
 Argentina peso                  23.25     -0.43    -17.29
 (Reporting by Gram Slattery; additional reporting by Jorge
Otaola in Buenos Aires
Editing by Nick Zieminski and Diane Craft)
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