EMERGING MARKETS-Brazil stocks fall for 2nd day on pension reform jitters

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By Bruno Federowski SAO PAULO, Nov 10 – Brazilian stocks fell for a second day on Friday as concerns over President Michel Temer’s ability to streamline the social security system weighed on demand for local assets. After a week of conflicting signs from policymakers, traders generally agree that the most likely scenario is Congress will vote on pension reform by early 2018. Investors see the bill as key to curbing growth of public debt and boosting long-term growth. Still, they fear lawmakers may greatly water down the plan, seeking to preserve their image ahead of the 2018 elections. “There’s really no telling what exactly will be discussed or approved,” Modalmais chief economist Alvaro Bandeira said. The benchmark Bovespa stock index fell 0.6 percent. Shares of Centrais Elétricas Brasileiras SA slumped for a second day after development bank BNDES said the power utility will sell power distribution firms for a “symbolic value.” The Brazilian real weakened 0.3 percent, on a day when most Latin American currencies seesawed as traders awaited further clues on the future of U.S. President Donald Trump’s tax plan. Disappointment that a landmark U.S. tax overhaul may be delayed until 2019 put a brake on the dollar’s recent rally. Investors say the tax reform could stoke inflation and force the Federal Reserve to raise rates at a faster-than-expected pace, drawing capital away from emerging market economies. Key Latin American stock indexes and currencies at 1640 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 1128.11 -0.5 31.49 MSCI LatAm 2764.11 -0.78 19.02 Brazil Bovespa 72475.19 -0.62 20.34 Mexico S&P/BVM IPC 48384.33 -0.68 6.01 Chile IPSA 5418.59 -0.46 30.52 Chile IGPA 27289.26 -0.4 31.61 Argentina MerVal 27421.15 -1.9 62.08 Colombia IGBC 10768.83 -0.35 6.33 Venezuela IBC 657.67 -4.06 -97.93 Currencies daily % YTD % change change Latest Brazil real 3.2693 -0.32 -0.61 Mexico peso 19.0665 -0.17 8.80 Chile peso 630.98 -0.18 6.29 Colombia peso 3010.15 -0.08 -0.29 Peru sol 3.242 -0.03 5.31 Argentina peso (interbank) 17.5050 0.06 -9.31 Argentina peso (parallel) 17.89 0.34 -5.98 (Reporting by Bruno Federowski; Editing by Steve Orlofsky)

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