The currencies and stock markets of Latin America closed with strong losses on Wednesdays, due to persistent concerns about the global banking sector after Silicon Valley Bank collapse (SVB) and the collapse of the shares of Credit Suisseafter revealing weaknesses in its financial reports.
In addition The dollar index, which compares the greenback against a basket of six major currencies, rose around 1%since the US currency was used as a safe haven currency.
The Mexican peso traded near the close at 18.9751 per dollar, with a loss of 2.07% against the Reuters reference price on Tuesday, erasing the previous day’s gains.
“Caution increases in Europe, where the listing of 7 banks was suspended”Monex Grupo Financiero analysts said in a note. “The psychological resistance of $19.00 seems to be gaining strength, so it will be necessary for the exchange rate to close above it to see further gains,” they added regarding the peso.
The main stock index S&P/BMV IPC, which includes the 35 most liquid companies in the Mexican market, fell 1.12% to 52,102.98 units.
“Worldwide stock markets present mostly negative movements, taking up the concerns generated by the banking sector in the United States,” Monex said early in an analysis note sent to its clients.
The Brazilian real depreciated 0.71%, to 5.2903 units per dollarwhile the Bovespa index on the B3 stock exchange in Sao Paulo pared much of its losses, showing a fall of 0.25% to 102,675.45 points.
In Argentina, the peso fell 0.23% to 202.56/206.57 per dollar in depreciation regulated by the central bank, while the Merval stock index fell 4.82%, to 209,824.20 unitsgiven growing fears about the situation of the banks and one day after the southern country announced strong inflation of 6.6% during February.
“The markets are crazy. We went from the problems of the American banks to the problems of the European banks, first of all Credit Suisse”said Carlo Franchini, head of institutional clients at Banca Ifigest in Milan.
The Chilean peso fell 2.9%, to 826.50/826.80 per dollar under pressureIn addition, due to a sharp drop in the price of copper, the country’s main export. Meanwhile, the leading index of the Santiago Stock Exchange, the IPSA, fell 1.9% to 5,197.85 units.
The Colombian peso fell 3.06% to 4,890 units per dollarwhile he in the bag, the benchmark MSCI COLCAP index, lost 3.8% to 1,111.75 points.
The dollar rose on safe-haven buying after Credit Suisse shares tumbled following the disclosure of “weaknesses” in its financial reports that deepened investor concerns that a global banking crisis may be brewing.
The Peruvian sol fell 0.5%, to 3.7888 units per dollar, while the benchmark on the Lima Stock Exchange fell 1.11%, to 555.29 points.
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