Emerging Markets-LatAm stocks down as oil drop counters metal gains, FX mixed

Copper prices climbed to a two-month high as inventories outside the U.S. declined, while precious metals advanced as lower oil prices reduced expectations for an interest-rate hike by the U.S. Federal Reserve. Mexican miner Grupo Mexico GMEXICOB.MX advanced 2.6% to its highest in more than a month, tracking copper prices. Mexican benchmark .MXX rose 0.3%. Chile's peso CLP= strengthened more than 1.5% to its highest level in over a month, even as stocks .SPIPSA in the world's largest copper producer fell 0.3%. Oil prices fell to a three-week low, below $80-a-barrel mark, after Qatari and U.S. officials raised hopes for a diplomatic resolution to the Iran war. The decline weighed on major energy firms. Ecopetrol ECOPETROL.CN slipped 3.5% and dragged Colombian equities .COLCAP 0.8% lower. Stocks in resource-rich Latin America fell on Tuesday as gains from higher metal prices were outweighed by a sharp drop in oil, while currencies traded mixed against the dollar. MSCI's index tracking regional equities .MILA00000PUS and its currencies equivalent .MILA00000CUS edged down 0.3% and 0.4%, respectively. Latin American assets have rallied this year as the region's commodity exporters captured windfall gains across metals and energy. Among currencies, the Colombian peso COP= firmed 0.9% after logging its biggest decline in over a year in the previous session, following the central bank's surprise announcement to build up its international reserves. In Brazil, industrial production registered its biggest month-on-month drop since late 2025 in June, data showed, reinforcing expectations for a rate cut from the central bank, which starts its policy meeting later in the day. "The data reinforce our view that Brazil's industrial recovery is losing momentum. Restrictive financial conditions remain the principal headwind," said Andres Abadia, chief LatAm economist at Pantheon Macroeconomics. Abadia, however, said persistent inflation and still-elevated inflation expectations argue against an aggressive pace of rate cuts. The Brazilian real BRL= declined 0.9% to a three-week low, while stocks .BVSP dipped 0.1%, with state-run oil firm Petrobras PETR4.SA falling 1.1%. Markets are also bracing for impact from a severe El Nino that could impact food production and energy generation and potentially drive inflation, with countries such as Colombia, Peru and Brazil most exposed. Analysts at Bank of America Global Research estimate that the weather phenomenon puts around 35% of Argentina's wheat output at risk, while Brazil's corn production could decline by around 10% year-on-year. In Mexico, mining industry is expecting a rebound in investment in 2026, as firms focus on expanding mines and purchasing equipment. The country's central bank is expected to hold its benchmark interest rate at 6.50% in its next decision on Thursday, a poll showed. The peso MXN= traded 0.4% higher. Meanwhile, shipping activity in Argentina's grain port has been halted due to a strike by maritime workers following a government decree deregulating river navigation services. The country is one of the world's leading grain suppliers. The Argentine peso ARS=RASL dipped 0.1%, while its stocks .MERV fell 2.6%.

Emerging Markets-LatAm stocks down as oil drop counters metal gains, FX mixed

Commodities and energy drive mixed performance

Latin American stocks and currencies edge lower

Brazil data and policy expectations weigh on assets

Weather, rates and trade disruptions remain in focus

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