Brazil stocks rose on Friday as signs of progress in the ongoing trade talks between the United States and China overshadowed global growth fears, boosting appetite for equities globally. Latin American currencies strengthened on Friday as the dollar softened and oil prices hit a 2019 high on Opec's ongoing supply cuts.
Chinese Vice Premier Liu He is expected to meet with US President Donald Trump at the White House on Friday, after their teams haggled through the week to sort out some on the most contentious issues of the trade war. The meeting will be crucial, since just a week remains before Washington's deadline for imposing tariffs on Chinese goods imported to US resumes.
Sao Paulo's Bovespa index rose 0.3 percent in line with emerging market stocks which climbed to their highest since September 2018 on trade optimism. "The movement today is purely externally driven, there is no local optimism and we have not seen any news or progress with respect to Social Security," said Cleber Alessie Machado, a derivatives broker at brokerage H.Commcor. The market is hoping Brazil's congress will pass an overhaul to cut the deficit in the government's Social Security system.
Materials stocks led by steelmaker Sid Nacional helped lift the index but gains were capped by losses from the consumer sector led by airline miles provider Smiles Fidelidade and retailer Via Varejo. Currencies in the region jumped with Brazil's real leading gains and Chile's peso rising to its highest since August 2018, due to a sharp rise in the price of Chile's top export, copper.
Mexico's peso was set to hold gains for the first time in three days as oil prices hit 2019 highs. The Mexican central bank's latest monetary policy meeting minutes released on Thursday showed most board members concerned about a credit rating downgrade for state oil company Pemex. Ratings agency Fitch double-downgraded Pemex's credit to the last rung of investment grade last month, sparking speculation that Mexico's sovereign rating was possibly next.
Comments
Comments are closed.