EMERGING MARKETS-Latin American stocks touch 2-1/2 year high

* Vale CEO pick could help ease tensions with government

* Global risks remain, but seen largely priced in

* Brazil Bovespa up 0.25 pct, Mexico IPC up 0.13 pct

By Luciana Lopez

SAO PAULO, April 5 (Reuters) – Investors drove Latin
American stocks to a 2-1/2 year high on Tuesday on views that
ongoing global risks were now largely priced in, as a chief
executive change for Brazilian mining giant Vale boosted
volumes.

The MSCI Latin American stocks index (.MILA00000PUS: Quote, Profile, Research) rose
0.45 percent and touched its highest level since June 2008. The
index has rallied for the previous five sessions, putting on
5.3 percent.

Foreign investors have stopped their exodus from emerging
markets to developed economies, said Adriano Moreno, a
strategist with Futura Investimentos. That doesn’t mean they’re
returning — yet — but it does mean that flows have
stabilized, he said.

“We’ve still got a significant slate of global risks,” he
said. But markets have now priced in a sovereign debt crisis in
the euro zone, Moreno said, with a downgrade of Portugal’s
credit rating on Tuesday leaving investors unfazed.
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A Chinese interest rate hike had a similarly muted effect
in markets, as the world’s second-biggest economy has been
fighting consumer price pressures for some time.
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In addition, high hopes for corporate profits this year
were buoying stocks, Moreno said. “Generally, there’s a more
optimistic climate,” he said.

Brazil’s benchmark Bovespa stock index (.BVSP: Quote, Profile, Research) rose 0.25
percent to 69,877.27. The index broke above 70,000 points
earlier in the session, its first time at that level since
January.

The index got a boost from shares of mining company Vale,
which saw heavy volume on news of a new chief executive pick.
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“In our view, the appointment of an executive with
extensive track record in the mining industry and strong
knowledge of Vale’s operations should be positive for the
company,” Deutsche Bank analysts wrote to clients.

The company’s preferred shares (VALE5.SA: Quote, Profile, Research) rose 0.08 percent
and Vale’s common stock (VALE3.SA: Quote, Profile, Research) moved up 0.07 percent. Each
spent time in negative territory during the session, as well.

Mexico’s IPC index (.MXX: Quote, Profile, Research) added 0.13 percent to 37,952.00.
The IPC has hit resistance at 38,000, and analysts said a break
above 38,100 to 38,200 in the coming days would be needed to
suggest the index could rise further toward its all-time high
set in January.

If the resistance levels can not be broken in the short
term, investors could look to take profits, analysts said.

Conglomerate Alfa (ALFAA.MX: Quote, Profile, Research) rose 1.12 percent, leading
gains in Mexico City. Shares of telecommunications giant
America Movil (AMXL.MX: Quote, Profile, Research) added 0.17 percent.

Chile’s IPSA index (.IPSA: Quote, Profile, Research) advanced 0.13 percent, despite
early time in negative territory. The IPSA hit its highest
intraday level since January.

The IPSA’s relative strength index, a technical indicator
used to gauge momentum, was close to generating an overbought
signal.

Forestry and paper company CMPC (CAR.SN: Quote, Profile, Research) gained 1.96
percent, with fertilizer, lithium and iodine producer Soquimich
(SQM_pb.SN: Quote, Profile, Research) up 1.27 percent.
(Additional reporting by Michael O’Boyle in Mexico City,
Editing by W Simon )

EMERGING MARKETS-Latin American stocks touch 2-1/2 year high