×

EMERGING MARKETS-Brazil stocks up on reform hopes, but political woes linger

(Updates prices) SAO PAULO, May 24 (Reuters) - Brazilian stocks rose for a second day on Wednesday, supported by efforts by President Michel Temer's government to maintain an ambitious reform agenda amid growing political unrest. Temer's plans to streamline Brazil's pension system cleared another hurdle in Congress on Tuesday. House speaker Rodrigo Maia said a vote in the full lower house could take place between June 5 and June 12, clearing the way for a final Senate vote. The benchmark Bovespa stock index rose nearly 1.0 percent, led by stocks which had suffered deeply since tapes showing Temer allegedly condoning bribes to silence a witness in a corruption case went public last week. Shares of logistics operator Rumo Operadora Multimodal SA rose for a second day, rebounding from a 23.5 percent three-day drop. The interest rate sensitive stock was bolstered by a decline in yields of interest rate futures as traders pared back bets that the central bank would be forced to cut rates at a slower pace than expected. Still, concerns over the political environment lingered. Traders said volatility is likely to remain elevated in the medium term as the crisis drags on. Other Latin American currencies see-sawed on thin trading volumes ahead of the release of the minutes of the Federal Reserve's last policy meeting later on Wednesday. The Mexican peso strengthened to its best level since the election of U.S. President Donald Trump in November, up 0.93 percent, while the Colombian peso was nearly flat. Traders have been eagerly seeking hints over the pace of U.S. rate hikes in coming months after a batch of mixed economic data cast doubt on expectations of a fast tightening. Higher U.S. rates could dampen demand for high-yielding emerging market assets.

Key Latin American stock indexes and currencies at 2100 GMT: Latin American market prices from Reuters

Stock indexes daily % YTD %

change change Latest

MSCI Emerging Markets 1005.03 0.06 16.56 MSCI LatAm 2558.31 0.84 9.3 Brazil Bovespa 63257.36 0.95 5.03 Mexico IPC 49494.40 0.92 8.44 Chile IPSA 4871.34 0.77 17.34 Chile IGPA 24440.82 0.7 17.88 Argentina MerVal 21684.59 0.76 28.18 Colombia IGBC 10757.92 0.01 6.22 Venezuela IBC 72689.66 0.06 129.27 Currencies daily % YTD %

change change Latest

Brazil real 3.2754 0.08 -0.80 Mexico peso 18.4460 0.93 12.45 Chile peso 670.9 0.60 -0.03 Colombia peso 2902.98 0.00 3.39 Peru sol 3.267 0.43 4.50 Argentina peso (interbank) 16.0800 0.12 -1.27 Argentina peso (parallel) 16.24 0.25 3.57

(Reporting by Bruno Federowski; Editing by James Dalgleish)