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EMERGING MARKETS-Latam stocks, currencies slide after Trump warns on U.S.-China trade deal

U.S.-China trade deal@

May 9 (Reuters) - Latin American stocks and currencies slid on Thursday after U.S. President Donald Trump warned that a trade deal with China was in serious danger, pushing investors away from riskier assets. Trump has warned that tariffs on Chinese goods worth $200 billion would rise beginning Friday if an agreement is not reached. China has reportedly asked the United States to meet halfway to salvage a deal that would end their protracted trade war that has roiled financial markets since last year.

MSCI's index of Latin American stocks fell 1.5 percent with Brazil's Bovespa leading losses, while Colombia's IGBC index was the only gainer in the region.

Sao Paulo-traded stocks dropped 1.4 percent with oil company Petroleo Brasileiro falling nearly 2 percent. The company is expected to launch a secondary share offering on May 24. Azul, Brazil's third largest airline, was off 2 percent in U.S.-trading as higher operating costs sent first-quarter profits down 20 percent. The real was the biggest loser among regional currencies after Brazil's central bank kept its benchmark interest rate on hold at a record-low 6.50 percent on Wednesday in view of inflationary risks. "We believe that the central bank will only start considering eventual rate cuts after concrete signs of passing effective pension reform in Congress, " said Mauricio Oreng, senior Brazil strategist at Rabobank in a note. Mexican stocks fell for a 13th straight session while the peso weakened on lower oil prices. Chile's peso fell to its lowest since the start of the year, tracking a dip in the price of copper, the country's top export, while Peru's sol was off 0.4 percent. Central banks from Chile and Peru will release monetary policy decisions later in the day, with analysts expecting bankers in both countries to hold rates.

Key Latin American stock indexes and currencies at 1420 GMT

Stock indexes daily % YTD %Latest change changeMSCI Emerging Markets 1024.94 -2.47 8.83MSCI LatAm 2643.07 -2.2 5.32Brazil Bovespa 94316.44 -1.34 7.32Mexico IPC 42830.45 -1.34 2.86Chile IPSA 5019.27 -0.81 -0.81Argentina MerVal 33571.15 -0.61 10.82Colombia IGBC 12505.17 0.1 12.21Currencies daily % YTD %change change


Brazil real 3.9688 -0.92 -16.52Mexico peso 19.2500 -0.88 2.33Chile peso 686.3 -0.31 -10.44Colombia peso 3289.88 0.05 -9.36Peru sol 3.323 -0.21 -2.59Argentina peso 45.6800 -1.16 -59.28


(Reporting by Agamoni Ghosh; Editing by Jeffrey Benkoe)