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EMERGING MARKETS-Latam FX firm; Petrobras rally takes Bovespa to new highs

By Susan Mathew

* Petrobras rises 2%, says may divest billions more than forecast * Chile stocks, peso rise; central bank holds benchmark rate * Argentine c. bank chief resigns as new govt takes office By Susan Mathew Dec 5 (Reuters) - Brazil's real and Chile's peso touched two-week peaks to lead Latin American currencies higher on Thursday as they capitalized on the dollar's weakness, while a rally in stocks saw Brazil shares scale new highs. Stocks took support from lingering optimism over the Sino-U.S. trade war, after a Bloomberg report as well as positive comments from U.S. President Donald Trump brewed some hope over a "phase-one" trade deal. Regional markets have also been propped up by some positive economic readings this week, with better-than-expected GDP data from Brazil, Latin America's largest economy, being the most notable. Brazilian stocks extended Wednesday's gains to touch a fresh record high, boosted by shares of state oil firm Petroleo Brasileiro SA. Petrobras, as the firm is commonly known, rose more than 2% after its executives said it could add several billion dollars of assets to its already ambitious five-year divestment plan. Adding to the optimism, Treasury Secretary Mansueto Almeida said Brazil's economy is entering 2020 on a stronger footing than originally hoped for. Brazil's currency gained 0.5% to 4.185 against the greenback which languished at one-month lows. A Reuters poll showed that the real is expected to be one of the notable gainers in emerging markets in 2020, firming to 3.97 per dollar. In Chile, stocks rose to a two-week high, while the peso firmed 0.7%. The currency has been propped up by a massive central bank stimulus program, which went into effect earlier in the week. Chile's central bank on Wednesday held its benchmark interest rate and said it would likely keep it there for the next several months, even as weeks of protests begin to hammer the country's economy. However, the bank also slashed its economic growth forecasts for 2019 and 2020 on Thursday, warning that effects of the unrest would linger into next year. "Though it's too early to say, especially if the Chilean peso reverses quickly and beyond the central bank's expectations, the higher inflation forecasts bias the next move to a hike," Citi analysts wrote in a note. "As for FX, a hawkish central bank with no cuts on the horizon should help stabilize the currency, which has been plagued by its low carry." The Argentine peso fell after central bank chief Guido Sandleris resigned on Wednesday, an expected step as Latin America's third-largest economy transitions to Peronism next week under newly elected President Alberto Fernandez. Key Latin American stock indexes and currencies at 1933 GMT: Stock indexes Latest Daily % change MSCI Emerging 1043.94 0.71 Markets MSCI LatAm 2723.58 0.69 Brazil Bovespa 110666.67 0.33 Mexico IPC 42211.92 0.05 Chile IPSA 4735.10 1.94 Argentina MerVal 35045.84 1.021 Colombia COLCAP 1612.73 0.04 Currencies Latest Daily % change Brazil real 4.1856 0.38 Mexico peso 19.3510 0.38 Chile peso 781.6 0.79 Colombia peso 3462 0.16 Peru sol 3.379 0.00 Argentina peso 59.9750 -0.15 (interbank) (Reporting by Susan Mathew and Ambar warrick in Bengaluru; Editing by Nick Zieminski)