EMERGING MARKETS-Latam currencies steady on trade optimism; growth outlook weighs on stocks
(Recasts throughout, updates prices) By Agamoni Ghosh Feb 25 (Reuters) - Most Latin American currencies steadied on Monday as investors shifted from the safe-haven dollar after the United States extended a tariff relaxation on Chinese imports, a step closer to resolving trade disputes.
Global equities cheered U.S. President Donald Trump saying that he would delay a planned hike in tariffs, raising hopes of an actual deal likely to materialize soon and end the trade standoff that has roiled the markets for months.
MSCI's index for stocks in Latin America however, fell 0.3 percent, bucking a global trend after sets of data for Brazil and Mexico aided by tepid growth forecast by Goldman Sachs for the region weighed on sentiment.
Goldman Sachs cut its economic growth forecasts for key Latin American countries and lowered the outlook for official interest rates across the region on Monday, citing weak domestic momentum and a deterioration in the global picture.
"The late 2018 and early 2019 growth momentum has been weaker than expected across a number of the large economies — Argentina, Brazil, and Mexico," Goldman's New York-based team of Latin American economists wrote in a note on Monday.
The dollar's weakness helped Brazil's real chalk up heavy gains earlier in the session but a slump in oil prices dragged the currency down.
Stocks in Sao Paulo's Bovespa index also fell, dragged by shares of Petrobras and banks and after data showed current account deficit widened slightly and foreign investment slowed sharply in January compared with the same month a year earlier.
Material stocks emerged as the lone gainer on the index buoying on trade optimism led by steelmaker Sid Nacional .
Mexico's peso rose marginally, while stocks fell 0.2 percent after data showed the economy grew less than first estimated in the fourth quarter as activity contracted in December, the first month of President Andres Manuel Lopez Obrador's administration.
Chile's peso rose to its highest level since August 2018, favored by an advance in the price of copper, while stocks on the IPSA index ended 0.8 percent lower but hovered around five-month highs.
Argentina's stocks benchmark fell 0.8 percent, while the country's peso firmed against a weak dollar.
Colombian stocks were the only exception on the region, climbing to three-month highs while the peso rose 0.6 percent.
Latin American stock indexes and currencies at GMT 2140 GMT Stock indexes daily % Latest change MSCI Emerging Markets 1067.64 0.85 MSCI LatAm 2891.92 -0.34 Brazil Bovespa 97239.90 -0.66 Mexico IPC 43664.33 -0.17 Chile IPSA 5479.69 -0.08 Argentina MerVal 36332.03 -0.86 Colombia IGBC 12227.77 1.19 Currencies daily % change Latest Brazil real 3.7472 -0.12 Mexico peso 19.1418 0.03 Chile peso 650.15 0.16 Colombia peso 3101.5 0.16 Peru sol 3.304 0.06 Argentina peso (interbank) 39.0200 0.46 (Reporting by Agamoni Ghosh in Bengaluru; Additional reporting by Jamie McGeever; editing by Grant McCool)
