Emerging Markets: Latin American stocks fall amid Brazil weakness, currencies mixed

Ambev SA

29/02/2024 15:28

* 
      U.S. inflation rose in-line with expectations
    

        * 
      Brazil's Ambev falls after Q4 profit miss
    

        * 
      Stocks down 0.3%, FX flat
    

  
    By Shashwat Chauhan
       Feb 29 (Reuters) - Latin American currencies were mixed
on the last trading day of the month on Thursday, as investors
parsed through a U.S. inflation reading, while a gauge of stocks
lost ground on weakness in Brazilian shares.
    A gauge of Latin American stocks  .MILA00000PUS  dropped
0.3% as heavyweight Brazil's main stock index  .BVSP  fell 0.8%
as losses in financial stocks weighed.
    Brazilian brewer Ambev  ABEV3.SA  lost 7.3% after missing
fourth quarter net profit estimates. 
    Stocks in Argentina  .MERV  rose 3.4%, while Mexican shares
 .MXX  advanced 0.3%.  
    At 10:09 a.m. ET (1509 GMT), MSCI's gauge for Latin American
currencies  .MILA00000CUS  was flat, on track for marginal
monthly gains.
    Brazil's real  BRL=  was flat at 4.9673 per dollar after
data showed the country's unemployment rate ticked up in the
three months through January, but came in below market
expectations.
    Average wages, a metric policymakers have been closely
tracking, rose 1.6% on a quarterly basis and 3.8% year-on-year.
    "The behavior of real wages reinforces our call that
services disinflationary process will remain sticky, narrowing
room for Selic rate cuts with a 10% terminal rate," Citi
economists wrote in a note.
    Last month, Brazil's central bank had cut its benchmark
interest rate by 50 basis points for the fifth consecutive time
to 11.25%.
    Meanwhile, the dollar index  =USD  weakened after U.S.
prices picked up in January, but the annual increase in
inflation was the smallest in nearly three years, keeping a June
interest rate cut from the Federal Reserve on the table.
    "Inflation continues to moderate despite upgraded outlooks
for the U.S. economy ... today's numbers show just enough
softening to keep worries at bay," David Russell, global head of
market strategy at TradeStation said. 
    Following the report, traders added to bets the U.S. central
bank will cut rates in June. 
    The Mexican peso  MXN=  edged 0.2% higher and was on track
to be the best performing currency amongst local peers this
month.
    Data from the national statistics agency showed Mexico's
seasonally adjusted unemployment rate stood at 2.8% in January. 
    Higher copper prices helped top producer Chile's peso  CLP= 
rise 0.9%, though it was on track to be the worst performing
currency among local peers this month, eyeing a decline of over
4.5% in Feb.
    Fellow copper producer Peru's sol  PEN=  also rose 0.1%,
while Colombia's peso  COP=  fell 0.2%.   
    
    HIGHLIGHTS
    ** India's economy grows at its fastest pace in six quarters
in election boost for Modi
    ** Chile's copper output up 0.5% in January
    ** Brazil seeking joint G20 statement on international
taxation by July
    
    Key Latin American stock indexes and currencies:
    
    
    Stock indexes             Latest    Daily % change
 MSCI Emerging Markets         1021.45            0.27
  .MSCIEF                               
 MSCI LatAm                    2525.46           -0.26
  .MILA00000PUS                         
 Brazil Bovespa              129086.29           -0.82
  .BVSP                                 
 Mexico IPC                   55505.11            0.28
  .MXX                                  
 Chile IPSA                    6444.83            1.58
  .SPIPSA                               
 Argentina MerVal           1033101.47           3.431
  .MERV                                 
 Colombia COLCAP               1285.86            0.03
  .COLCAP                               
                                                      
       Currencies             Latest    Daily % change
 Brazil real        BRBY        4.9704            0.00
                                        
 Mexico peso                   17.0571            0.19
  MXN=D2                                
 Chile peso       CLP=CL         968.2            0.77
                                        
 Colombia peso  COP=           3929.46           -0.16
 Peru sol         PEN=PE        3.7753            0.21
                                        
 Argentina peso               842.3000           -0.06
 (interbank)  ARS=RASL                  
                                        
 Argentina peso                   1010            3.47
 (parallel)  ARSB=                      
                                        
 

 (Reporting by Shashwat Chauhan in Bengaluru; Editing by Chizu
Nomiyama)
 ((Shashwat.Chauhan@thomsonreuters.com;))