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Latam stocks fall, Brazil’s real set for worst week in a year

(Updates prices, adds news items) By Agamoni Ghosh and Sruthi Shankar Nov 8 (Reuters) – Brazil’s real led Latin American currencies lower on Friday, hit by underwhelming oil auctions and political concerns, while stocks in the region fell on doubts about an agreement between Washington and Beijing to roll back tariffs. MSCI’s index of Latin American currencies fell nearly 1% as most currencies were thwarted by a stronger dollar, with the real set for its worst week since August 2018. The steep declines come after major global oil companies snubbed Brazil’s biggest-ever pre-salt oil auction earlier this week. Adding to the real’s woes was a decision by the country’s Supreme Court that could lead to the release of former President Luiz Inacio Lula da Silva from prison, which could unite leftist forces against the right-leaning government in power. “Lula may have the ability to unite the left side of the political spectrum, thus increasing opposition to fiscal reforms and austerity measures,” said Simon Harvey, FX analyst at Monex Europe. If released, Lula, 74, would be free to engage in politics but not eligible under Brazil’s Clean Record law to seek elected office until 2025, eight years after his first conviction. All other major Latin American currencies were also set to end the week lower with Chile’s peso headed for its third straight week of losses as the country reels with the after-effects of its worst domestic unrest since the South American nation’s return to democracy in 1990. MSCI’s index of Latin American stocks fell 1.6% with most indexes in the red as conflicting trade headlines kept investors on the back foot. The Bovespa fell 0.6% but still was on track to the end the week higher, helped by some upbeat earnings. Chile’s SPIPSA index bucked the gloomy trend to climb 0.3% higher, driven by shares of consumer-focused companies. Data showed consumer prices in the country rose 0.8% in October, slightly above market expectations. Latin American stock indexes and currencies at 19:01 GMT Stock indexes daily % Latest change MSCI Emerging Markets 1064.55 -0.84 MSCI LatAm 2747.77 -1.75 Brazil Bovespa 108444.72 -1.04 Mexico IPC 43744.56 -0.85 Chile SPIPSA 4689.90 0.37 Argentina MerVal 34202.55 -4.646 Colombia IGBC 13310.04 -1.21 Currencies daily % Latest change Brazil real 4.1475 -1.31 Mexico peso 19.1001 0.07 Chile peso 746.3 -0.54 Colombia peso 3336 -0.60 Peru sol 3.359 -0.48 Argentina peso 59.5000 0.17 (interbank) (Reporting by Agamoni Ghosh and Sruthi Shankar)

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