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EMERGING MARKETS-Latam stocks at 10-week high, FX rallies

Latin American stocks hit a 10-week high, while currencies rallied on Monday as investors bet on economic recovery from the coronavirus with more countries emerging from virus-induced lockdowns. Brazil's real jumped 2%, extending gains to a fourth session, while Mexico's peso appeared to be headed for its sixth straight winning session. Chile's currency gained 0.8%. In line with broader emerging market peers, regional stocks rallied. Sao Paulo's Bovespa index jumped nearly 4% to a near 11-week high, while Mexican stocks added 0.2%. The MSCI's index of Latin American equities rose 3.5%, although trading volumes were thin as UK and U.S. markets were closed for holidays. Data showing improving business confidence from Europe's powerhouse, Germany, reinforced hopes that further easing of virus-related restrictions would help the global economy emerge from what is expected to be a deep recession. "The low point of the slump should now be behind us and there even is the chance for a short-lived strong rebound in the coming months," Carsten Brzeski, chief economist for the euro zone at ING, said of the data. The data, along with news that Japan had lifted a virus-driven state of emergency across several areas, saw a pullback in the U.S. dollar as risk appetite grew, aiding regional currencies. The MSCI's index of regional currencies rose more than 1% to touch its highest level this month. Still, from an economic perspective, the regional picture remained grim, with Brazil on Friday sharply revising downward its 2020 budget deficit and national debt forecasts to record levels. With over 360,000 cases, Brazil is the second worst-hit country globally by the COVID-19 disease caused by the virus. Brazil's President Jair Bolsonaro has been an open critic of social distancing protocols, calling for increased business activity to keep the economy afloat. A federal investigation revealing likely abuse of power has further hit Bolsonaro's popularity. And, several ministers from his administration have resigned in the last two months over differences with him. In Mexico, President Andres Manuel Lopez Obrador said a slowdown in China's economy this year should allow Mexico to attract more investment. U.S.-China trade tensions stewed as the White House warned of sanctions on China as Beijing pressed ahead with a new security law on Hong Kong that threatens the city's status as a financial hub. Markets in Argentina and Colombia were closed for national holidays. Latin American stock indexes and currencies at 1853 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 911.56 0.7 MSCI LatAm 1733.86 3.82 Brazil Bovespa 85467.28 4.01 Mexico IPC 35891.97 0.3 Chile IPSA 3719.37 -0.11 Currencies Latest Daily % change Brazil real 5.4584 2.09 Mexico peso 22.6089 0.51 Chile peso 804.5 0.12 Peru sol 3.4257 0.10 (Reporting by Susan Mathew in Bengaluru; editing by Jonathan Oatis and Grant McCool) Our Standards:The Thomson Reuters Trust Principles.0 : 0narrow-browser-and-phonemedium-browser-and-portrait-tabletlandscape-tabletmedium-wide-browserwide-browser-and-largermedium-browser-and-landscape-tabletmedium-wide-browser-and-largerabove-phoneportrait-tablet-and-aboveabove-portrait-tabletlandscape-tablet-and-abovelandscape-tablet-and-medium-wide-browserportrait-tablet-and-belowlandscape-tablet-and-belowAppsNewslettersAdvertise with UsAdvertising GuidelinesCookiesTerms of UsePrivacyAll quotes delayed a minimum of 15 minutes. 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