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EMERGING MARKETS-Latam FX firm, Petrobras rally takes Brazil stocks to new highs

By Susan Mathew

By Susan Mathew Oct 25 (Reuters) - Most Latin American currencies firmed against a tame dollar on Friday, with Mexico's peso looking to post its best day in a week and Brazil's real hovering near its highest in more than two months. The peso rose 0.3%. Mexico's deputy foreign minister for North America, Jesus Seade, said U.S. lawmakers will soon begin the formal process of approving the United States-Mexico-Canada trade deal. The USMCA, signed last year, must win approval in a divided U.S. Congress where Democrats have voiced concerns over the agreement, including its labor and enforcement provisions. Brazil's real moved 0.7% higher against the dollar heading into a week that will see investors watching for a central bank meeting on interest rates. In Colombia, the peso climbed 0.3% ahead of Sunday's vote to choose provincial governors, mayors and regional legislators in elections that could influence the 2022 presidential contest. The vote is likely to emphasize the power of regional political families rather than parties, analysts told Reuters. One of the most keenly monitored events in Latin America over the weekend will be general elections in Argentina on Sunday, with populist-leaning candidate Alberto Fernandez expected to breeze past business-friendly President Mauricio Macri. Argentina's battered peso weakened another 1.34% on Thursday, even after the central bank intervened heavily to ease its fall. The peso had crashed in August when presidential primaries saw Fernandez win by a much larger margin than expected. A group of Argentina's largest bond holders have begun forming a "creditor committee" in preparation for debt negotiations after the country's elections, sources told Reuters. Chile's peso slipped marginally. Coper mining companies in the world's largest producer of the red metal said continuing nationwide riots had hobbled port facilities, public transportation and supply chains, making an impact on operations. Among stocks, Brazil's bovespa index scaled yet another life high as investors parsed through a batch of earnings reports. State oil firm Petrobras rallied after saying some of its costs in a key oil-producing region plunged in the third quarter. The firm reported quarterly net income significantly lower than the previous quarter partly because of already announced one-off charges. As iron ore prices on the Dalian exchange closed up 2.1%, miner Vale rose despite reporting a weaker-than-forecast 15% gain in quarterly earnings. Brewer Ambev slumped after reporting a 9.7% fall in third-quarter net profit. In Mexico, the benchmark index inched lower. Broadcaster Grupo Televisa rallied despite posting a 23% drop in profits, while Grupo Financiero Banorte slid. The bank posted a 13% increase in third quarter profit. Key Latin American stock indexes and currencies at 1421 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1035.29 -0.2 MSCI LatAm 2801.04 -0.07 Brazil Bovespa 107388.36 0.38 Mexico IPC 43745.31 -0.07 Chile IPSA 4954.21 -1.21 Argentina MerVal 33554.61 0.234 Colombia IGBC 13126.33 -0.19 Currencies Latest Daily % change Brazil real 4.0114 0.79 Mexico peso 19.0905 0.19 Chile peso 725.8 -0.28 Colombia peso 3394.61 0.28 Peru sol 3.349 -0.04 Argentina peso 59.9800 -0.30 (interbank) (Reporting by Susan Mathew in Bengaluru; Editing by Alistair Bell)