(Updated at 1520 GMT)

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Bets rise on 50 bps Fed cut in September

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Global stocks selloff amid growth worries, tech rout

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Brazil industrial data stronger than expected

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EM bond funds see outflows over past week: BofA

By Lisa Pauline Mattackal

Aug 2 (Reuters) - An index tracking global emerging

market currencies leaped against a falling dollar after

weaker-than-expected U.S. payrolls stoked hopes for a dovish

turn from the Federal Reserve, though EM equities and Latin

American currencies slumped as growth worries weighed.

MSCI's index of EM currencies leapt 0.3% to

its highest since May as the U.S. dollar fell after weak

payrolls data stoked hopes for a larger rate cut in September.

Expectations for the Fed to cut by 50 basis points (bps),

instead of 25 bps jumped from 22% to over 73% following the

data, according to the CME's FedWatch.

However, that was not enough to stem a global selloff in

equities as growth worries sent investors rushing for safe haven

assets. MSCI's index of emerging market stocks slumped

2.3%, set to clock its worst day since February 2023 if losses

hold.

Markets in Latin America also tumbled, with indexes of

regional currencies and stocks

down 1.7% and 2.9%, respectively, both at their lowest levels

since last October.

"What makes this a bad situation for Latin America is the

fact that the U.S. becoming a softer economy directly impacts

the general health of the hemisphere," said Juan Perez, director

of trading at Monex USA.

"Combined with China already not being an engine of growth,

it leaves Latam to its own domestic struggles which are only

exacerbated by a fragile political situation."

Mexico's peso slumped 1.1%, touching its lowest to

the greenback since March 2023 as a higher-than-expected jobless

rate print also weighed.

Bourses in Latin America slumped, with stocks in Argentina

, Brazil, Colombia and Mexico

down between 0.8% and 3.2%.

Stocks of the region's commodity-focused companies slumped,

with Brazil's Petrobras, Vale SA ( VALE ) and

Colombia's Ecopetrol falling to multi-month lows.

The moves capped a hectic week for emerging market assets.

An initial boost to risk sentiment following the Federal

Reserve's meeting on Wednesday quickly gave way to concerns over

global growth, after weak U.S. data, geopolitical worries in the

Middle East and further signs of economic slowdown in China.

MSCI's EM stock index was on track to fall for a third

straight week, however, the currency index was set to rise about

0.7% in its best week since December.

However, Latin American assets were set to underperform,

with the stocks index on track to fall over 3% and currencies

down 1.8%.

Brazil's real briefly slumped to its lowest since

2021 against the greenback, before reversing course to rise

0.1%.

Brazil industrial data came in strongly above expectations,

its best monthly growth since July 2020, data showed.

EM debt-focused funds saw outflows of $0.2 billion over the

past week, according to data from Bank of America Global

Research, though EM equity funds have seen about $4.5 billion in

inflows over the past nine weeks.

HIGHLIGHTS

** US, European lawmakers jointly condemn Venezuela's

handling of election

** Ethiopia will save $4.9 bln from debt restructuring,

state minister says

** Chilean court rejects Tianqi's request to pause

SQM-Codelco deal

** Nigerian police may seek army help after violent protests

Key Latin American stock indexes and currencies

Latest Daily %

change

MSCI Emerging 1063.03 -2.28

Markets

MSCI LatAm 2119.96 -2.97

Brazil Bovespa 126298.4 -0.86

7

Mexico IPC 52003.61 -0.79

Chile IPSA 6302.69 -1.8

Argentina 1453020. -3.146

MerVal 70

Colombia 1320.14 -1.61

COLCAP

Currencies Latest Daily %

change

Brazil real 5.7486 -0.26

Mexico peso 19.0421 -1.04

Chile peso 950.5 0.13

Colombia peso 4106.38 -0.57

Peru sol 3.7473 -0.41

Argentina peso 932.5000 -0.05

(interbank)

Argentina peso 1365 1.10

(parallel)