EMERGING MARKETS-Latam markets mixed amid U.S.-China trade tensions, recovery hopes

    By Susan Mathew
    June 1 (Reuters) - Latin American currencies struggled for
direction on Monday, as caution prevailed because of persistent
trade tensions between Beijing and Washington and investors kept
a close eye for any economic consequences of violence in major
U.S. cities.
    Brazil's real swung between looses and gains, while
Chile's peso traded flat against a weaker dollar. As oil
prices declined, Colombia's peso lost 0.1%. 
    Mexico's peso firmed 0.7% in line with broader
emerging market peers which rallied on hopes of an economic
recovery as governments ease restrictions that were imposed on
economic activity to contain the spread of the novel
    Some relief also stemmed from Washington stopping short of
imposing new tariffs or sanctions on Beijing and left the
so-called Phase 1 trade deal intact while responding to China's
new security law on Hong Kong. 
    But sources said China has asked state-owned firms to halt
purchases of soybeans and pork from the United States, after
U.S. President Donald Trump revoked Hong Kong's special status
under U.S. law. 
    Regionally, Brazil's economic pictured remained grim with a
central bank survey showing the 2020 outlook for the economy
deteriorated for a 16th week in a row, to a new consensus of a
6.25% contraction. 
    Stocks benchmarks in Latin America seesawed as the breakout
of violent protests in the United States in response to police
brutality weighed on Wall Street.
    MSCI's index of Latam shares rose 1.5% as
surging iron ore prices buoyed mining giant Vale,
while heavily weighted big banks in Brazil also gained. 
    The riots may harm economic activity in the United States,
especially given that many states have just begun unlocking
their economies, said Hussein Sayed, chief market strategist at
    Markets could react more strongly if the protests begin to
spiral out of control and potentially lead to transmission of
the coronavirus.
    Latin American stock indexes and currencies at 1400 GMT:
  Stock indexes           Latest   Daily %
 MSCI Emerging Markets     948.32     1.93
 MSCI LatAm               1795.79      1.2
 Brazil Bovespa          87756.33      0.4
 Mexico IPC              36057.44    -0.18
 Chile IPSA               3639.49    -0.22
 Argentina MerVal               -        -
 Colombia COLCAP          1098.18     0.21
      Currencies          Latest   Daily %
 Brazil real               5.3515    -0.24
 Mexico peso              22.0008     0.76
 Chile peso                 802.3     0.52
 Colombia peso             3730.5    -0.12
 Peru sol                  3.4228     0.12
 Argentina peso           68.6200    -0.12
 (Reporting by Susan Mathew in Bengaluru; editing by Grant

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