LatAm assets inch lower on higher oil prices, fiscal concerns
ILF•Latin American stocks fell 1.2% and currencies dropped 0.5% as oil prices near $100 a barrel and fiscal concerns weighed on sentiment. Colombian stocks were down 1.6%, while Argentina’s fell 2.3%.
1. Regional markets decline
Indexes tracking Latin American stocks and currencies fell on Wednesday, with the MSCI LatAm stocks index down 1.2% and its currency gauge down 0.5%. The dollar rose 0.4% as investors moved toward the safe-haven currency.
2. Oil and fiscal concerns
Oil prices near $100 a barrel, inflation concerns and higher borrowing costs limited gains for the region’s oil-producing economies. Argentina’s stocks fell 2.3%, while Colombian equities dropped 1.6%, on track for their sharpest daily decline in three weeks.
3. Country-specific developments
Colombia’s newly inaugurated government revoked a decree capping private pension funds’ foreign investments at 30%. HSBC downgraded equities in Chile and Mexico and upgraded Colombia on potential fiscal consolidation and oil-and-gas deregulation.
