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LATAM markets show widespread gains during Wednesday’s session

Ignacio Teson•Wednesday, February 14, 2024•1 min read

LATAM markets show widespread gains during Wednesday’s session

After two days of reduced activity due to holidays in China, Brazil, and Argentina, activity rebounds with improvements in prices.

LATAM markets and indices are on a positive note today.

After two days of low activity due to the Chinese New Year and Carnival holidays in Brazil and Argentina, prices in Latin American markets show an improvement compared to previous days. Mexico, Brazil, Colombia, and Argentina, the largest markets in the region, are showing increases averaging around 2%.

The increases are led by the banking sector in Argentina and Mexico, and the energy sector in Brazil and Colombia. The gains of the main ETFs tracking the LATAM region also reflect the positive performance of the indices. EWZ (Brazil) +2%, EWW (Mexico) +2%, Merval Index (Argentina) +2.4%, GXG (Colombia) + 1.5%.

Among the highlighted stocks in each of these countries during Wednesday’s session are Banco Galicia +3%, Fomento Economico Mexicano +1%, Eletrobrás +1.6%, and Ecopetrol +2%.

As for the commodities relevant to the region, they show a decline of close to 0.5% today. These include soybeans, corn, and wheat. Oil remains flat.

Could this be LATAM’s year? The answer is neither yes nor no. What is clear is that there are structural reasons to bet on these economies in the long term.

Many emerging markets have experienced robust growth in recent years, in large part thanks to increased FDI inflows. For instance, since the end of the COVID-19 pandemic, emerging economies are the only ones that have been able to truly grow at sustainable rates, with an equal growth rate of 4% in 2022 and 2023. As the IMF has stated, “the slowdown is concentrated in advanced economies.”

An important advantage of emerging countries (and LATAM) is that they have higher growth ceilings, not only due to macroeconomic factors but also because of an environment more conducive to productivity.

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ABOUT THE AUTHOR See More
Ignacio Teson
Economist and Financial Analyst
Ignacio Teson is an Economist and Financial Analyst. He has more than 7 years of experience in emerging markets. He worked as an analyst and market operator at brokerage firms in Argentina and Spain.
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