Latin American stocks jumped on Friday, helped by surprisingly strong US jobs data that eased fears about slowing global growth, as well as by cooler-than-expected inflation data in Brazil and Chile. The MSCI Latin American index rose 1.42 percent. The gauge still clocked a weekly loss of around 4.3 percent, its worst performance since May 2010, after sharp losses in commodities prices hit the region's raw material producers.
Data showed April US nonfarm payrolls rose by the most in 11 months, helping commodities bounce back. Consumer prices in Brazil rose less than expected in April in a sign government efforts to cool demand are taking hold. Worries about rising inflation and uncertainty about how the government will try to deal with price pressures have weighed on Brazilian stocks.
The Brazil data brought relief, analysts said. "It created a more benign inflation outlook," said Rossano Oltramari, chief analyst at Investment XP. The recent sell-off in commodities raised concerns among investors that the bull run in raw materials may be coming to an end, which could bode poorly for the regions's producers. "Commodities could remain volatile and investors will focus on the economic data," said Patricia Berry, an analyst at brokerage Intercam in Mexico City.
Stocks pared gains during the session due to speculation that Greece might leave the eurozone. Such a move could end up spurring major losses at European banks. Analysts said investors would be looking to Europe, as well as key Chinese economic data on Wednesday and US retail sales on Thursday. China is Brazil's top trading partner and a main buyer of the region's commodities.
Brazil's Bovespa stock index rose 1.59 percent for its biggest one-day gain since mid-February, but the index still ended down about 2.6 percent for the week. Homebuilder PDG Realty rose 5.56 percent, while retailer Lojas Americana, the country's largest discount retailer, rose 9.67 percent.
Peru stocks rose by the most during the week in nearly two years as investors bet right-wing presidential candidate Keiko Fujimori could take the lead in election polls to be released over the weekend. Peruvian stocks rose 5.48 percent on Friday, closing out a 10.88 percent gain for the week as polls showed Fujimori had narrowed the lead of left-wing nationalist Ollanta Humala, who won the first round vote on April 10. Peru's stocks have been pounded since late March on fears Humala could win and roll back free-market reforms. Mexico's IPC index fell 0.32 percent, hurt by a 1.92 percent slide after America Movil, which closed at its lowest in nearly a year amid concerns that regulators in Mexico could try to rein in its power.
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