Chile stocks gained for a fourth straight session on Friday, hitting a two-month high on news that Argentina would ease its natural gas cuts, adding to investor optimism over economic growth, traders said.
The IPSA blue-chip index, which has risen in nine of the last 10 sessions, climbed 0.13 percent to 1,472.27 points, its highest since April 14. The index has risen 5.4 percent since June 3. The broader IGPA index rose 0.43 percent to 7,416.19 points.
"Stocks are supported by the retail sector, growth numbers, and in the electrical sector there's relief over the reduction in gas cuts," said Francisco Montaner, general manager of Euroamerica brokerage in Santiago.
Energy group Enersis, weighted as 22 percent of the IPSA, was among the value leaders after Argentina said on Thursday it would repeal a measure that curbed natural gas supplies to Chile, alleviating fears of a Chilean energy crisis. Enersis advanced 0.59 percent to 77.84 pesos, accumulating a two-day gain of 1.9 percent.
Chile's No. 3 electrical generator Colbun lost 2.76 percent to 63.10 pesos, not quite erasing its 3.8 percent climb on Thursday.
Investors are worried about Brazilian market reactions after a Brazilian government defeat in a Senate vote on the nation's minimum wage. The political battle reveals fragile support for leftist President Luiz Inacio Lula da Silva.
Chile's much smaller financial markets often sway to the tune of Brazil's currency and stocks.
"Whether or not this rally continues depends on news from Brazil, which could have an impact on stocks, the currency and foreign investors," Montaner said.
The peso currency fell slightly against the US dollar as investors kept to the sidelines in anticipation of a US interest rate hike. The peso finished at 647.30/647.80 per dollar compared with Thursday's close of 647.00/647.50 pesos.
"There is still a lot of uncertainty in the market over how much the US rates will be increased, and nobody is taking risks until that is defined, which won't happen until the end of the month," said Eugenio Garay, a trader at Inversiones J.C. Tour.
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