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Argentina's Merval index rises on Bessent support

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Regional equities slip, capping volatile week

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UBS upgrades EM equities

By Niket Nishant

Oct 17 (Reuters) - Argentina's stocks gained

1.1% on Friday after another nod of confidence from Washington,

outperforming as Latin American markets limped towards the end

of a volatile week.

U.S. Treasury Secretary Scott Bessent reiterated support for

Argentina, adding to a string of measures this week that have

eased fears after President Donald Trump hinted that aid might

hinge on President Javier Milei's party doing well in midterm

elections.

"The long-term picture is one of increasing cooperation

between the two countries. The number one focus is to move past

the headlines of the midterm elections," said Thea Jamison,

founder of investment management firm CHANGE Global.

The Milei administration is seeking to restore investor

confidence amid persistent inflation, fiscal strain, and a

fragile political landscape.

Brazil's benchmark index rose 0.5%, helped by

optimism around upcoming corporate earnings despite pressure

from expiring stock options and weak cues from U.S. markets.

Option expirations often trigger portfolio adjustments and

volatility, as traders unwind positions and rebalance.

U.S. and Brazilian officials held trade talks on Thursday and

agreed to work to schedule a meeting between Trump and his

counterpart Luiz Inacio Lula da Silva.

Citi analysts cautioned that even if tariff risks ease,

uncertainty related to the domestic political environment could

weigh on sentiment.

Still, some companies could benefit from the government's

plans to offer financial guarantees to fund strategic mineral

projects and tax incentives for their processing and

industrialization.

An index tracking Latin American equities

and a parallel gauge of regional currencies each

slipped 0.3% but remained on track to end the week up 2.2% and

0.6%, respectively.

Colombia's stock market dipped 0.2% but was on

course for its second consecutive week of gains. The peso

strengthened against the dollar.

Raising the country's key interest rate for the first time in

over two years is "on the table" in the face of several risks

that could speed up inflation, Colombian central bank board

member Mauricio Villamizar said in an interview with Bloomberg

News published on Friday.

The remarks came days after Colombia's Senate gave the final

approval to the government's 2026 budget, sending it to the

president to sign.

Mexican stocks retreated 1.2% after two sessions of

gains.

Elsewhere, pockets of global assets found support as easing

tensions in the Middle East helped remove a long-standing drag

on risk sentiment. Long-dated Israeli bonds gained.

Brokerage UBS Global also upgraded emerging market equities to

"attractive".

Key Latin American stock indexes and currencies:

Equities

Latest Daily %

change

MSCI Emerging Markets 1,361.16 -1.29

MSCI LatAm 2,470.67 -0.34

Brazil Bovespa 142,890.64 0.49

Mexico IPC 61,782.83 -1.22

Argentina Merval 1,950,617. 1.094

08

Chile IPSA 9,091.34 -0.23

Colombia COLCAP 1,895.19 -0.19

Currencies

Latest Daily %

change

Brazil real 5.4397 0.1

Mexico peso 18.4433 -0.04

Chile peso 961.36 -0.58

Colombia peso 3,797 1.08

Peru sol 3.3848 0.02

Argentina peso (interbank) 1,435 -1.74

Argentina peso (parallel) 1,450 1.03