EMERGING MARKETS-Latam stocks up on U.S. Fed, Q3 earnings hopes

* Hopes for more global liquidity, Q3 earnings help stocks

* Mexico’s IPC index touches new alltime high

* Brazil’s Bovespa adds 1.18 percent, IPC up 0.91 percent

By Luciana Lopez and Caroline Stauffer

SAO PAULO/MEXICO CITY, Oct 13 (BestGrowthStock) – Latin American
stocks hit a better than two-year high early on Wednesday amid
investor hopeS the U.S. Federal Reserve will move to prop up
the economic recovery as well as expectations of strong
regional earnings reports in the coming weeks.

The MSCI Latin American stocks index (.MILA00000PUS: ) jumped
1.54 percent, vaulting to its highest level since July 2008
after a dip in the previous session.

Key U.S. indexes also gained in the morning, with the S&P
500 breaking through short-term resistance. For details, see

Investors see the Fed stepping in to boost sluggish growth
in the U.S. economy, the world’s largest and a major influence
on Latin America.

Cheap money from abroad could then find its way to
higher-yielding assets, such as emerging market currencies, via
the so-called carry trade.

Regional indexes also gained on Wednesday, with Mexico’s
IPC (.MXX: ) touching a new lifetime high and Brazil’s Bovespa
index (.BVSP: ) hitting its highest intraday level since April.

“There’s a lot of international liquidity,” said Dany
Rappaport, partner in InvestPort financial consultancy.

“Secondly, many investors see it as more worthwhile now to
hold stocks than bonds,” he said. Interest rates around the
world have remained low, affecting bond yields.

As a result, expectations of more liquidity — whether from
the Fed or other global central banks — help stocks, he

The third-quarter earnings season could also buoy equities,
if companies report solid profits. Brazilian companies begin to
report later in the month; in Mexico, retail giant Walmex
(WALMEXV.MX: ) said on Monday that its third-quarter net profit
rose but missed expectations. [ID:nN11128720]

Walmex shares edged up 0.19 percent on Wednesday.

Commodities also advanced, with the Reuters-Jefferies index
moving up (.CRB: ). Many companies in Latin America rely on the
trade in raw materials.

“The risk sentiment in markets is obvious as crude oil is
trading up along with copper and gold,” Scotia Capital analysts
wrote in a report.

Miner Grupo Mexico (GMEXICOB.MX: ) advanced 2.15 percent, as
Penoles (PENOLES.MX: ) rose about 2 percent. The miner’s
Fresnillo (FRES.L) precious metals unit said on Wednesday it
saw record production of silver and gold in the third quarter.

In Brazil, the benchmark Bovespa index jumped 1.18 percent,
trading slightly below a six-month high, a day after being
closed for a public holiday.

Brazil’s Vale (VALE5.SA: ), the world’s largest producer of
iron ore, climbed 0.63 percent.

But shares of Brazilian energy giant Petrobras (PETR4.SA: )
slipped 0.39 percent, despite a jump in oil prices.

That stock has struggled after last month’s $70 billion
share offering, the biggest in world history, with investors
still leery of the company’s future and its plans to tap
offshore reserves beneath a thick layer of salt.

Brazilian homebuilders advanced, helped by a bright outlook
for growth this year in Latin America’s biggest economy. PDG
Realty (PDGR3.SA: ) jumped 4.87 percent, Gafisa (GFSA3.SA: )
climbed 2.79 percent, Cyrela (CYRE3.SA: ) gained 2.73 percent and
Rossi Residencial (RSID3.SA: ) moved up 4.14 percent.

In Chile, the blue-chip IPSA stocks index (.IPSA: ) gained
1.62 percent, and looked poised to snap its worst six-day slide
since November 2009 after a four-month rally that added 25
percent to the index.

Falabella (FAL.SN: ) advanced 1.62 percent while fellow
retailer Cencosud (CEN.SN: ) gained 2.17 percent.

EMERGING MARKETS-Latam stocks up on U.S. Fed, Q3 earnings hopes