EMERGING MARKETS-LatAm FX, stocks climb as metals recover from rout

By Purvi Agarwal and Ragini Mathur

Feb 3 (Reuters) - Most Latin American currencies rebounded on Tuesday after three days of losses, while stocks climbed alongside a commodities rally that restored investor appetite for emerging market assets.

MSCI's index tracking LatAm stocks .MILA00000PUS jumped 2.2%, while the currencies gauge .MILA00000CUS rose 0.5% higher.

Gold surged about 5%, on track for its biggest daily gain since January 2009, and silver jumped as the precious metals staged a comeback from their steepest two-day drop in decades.

In Brazil, heavyweight stocks .BVSP gained 1.3% and hit an intraday record high, led by miner Vale VALE3.SA, up 4.1%.

The real BRL= was up 0.2%, after minutes from the central bank's latest meeting showed it signaled monetary policy easing from March but stressed that borrowing costs must remain restrictive.

In Chile, the world's largest copper producer, the peso CLP= appreciated 0.7% and stocks .SPIPSA rose 1.1% as copper prices recovered after news that China was planning to boost stockpiles of the red metal. MET/L

The Mexican peso MXN= climbed 0.8%, while stocks .MXX advanced 2.6%, on track for their biggest one-day climb since May.

Argentina bucked the regional rally as its benchmark stock index .MERV fell 2.3%, marking its fifth consecutive session of losses.

Argentine assets are under pressure after the resignation of the country's statistics agency head Marco Lavagna and delays in implementing a revised inflation measurement methodology, a sensitive issue given Argentina's history of massive inflation underreporting in the 2000s and 2010s that drew censure from the International Monetary Fund.

SUPPORTIVE MACRO BACKDROP UNDERPINS EM STRENGTH

Emerging market stocks extended gains into 2026 after a stellar 2025, as a weaker dollar supported demand and investors sought diversification away from U.S. assets.

"After a transformative 2025, resilience amid geopolitical and policy risks have been underpinned by attractive valuations, improving fundamentals, and a supportive macro backdrop," said Gabriel Sacks, investment director of Asian equities, at Aberdeen Investments.

"Global capex, favorable FX trends, and structural themes position EMs well (this year)."

U.S. President Donald Trump's nomination of former Federal Reserve governor Kevin Warsh on Friday supported the dollar index =USD, which pressured commodities. However, the greenback stabilized on Tuesday, with trading largely muted.

Colombia's currency COP= fell 1.2%, though the oil exporter's stocks .COLCAP gained 0.5% as oil prices stabilized following a 4% drop in the previous session.

Trump and Colombian President Gustavo Petro met for the first time on Tuesday in an encounter widely viewed as a test of whether the two leaders could forge a lasting detente despite their clashing ideologies.

Meanwhile, JPMorgan is finalizing plans for a new index to track frontier market local currency bonds, investors consulted on the details told Reuters, as the bank looks to satisfy a growing appetite for riskier and more diversified high-yield debt.

The proposed index could include 20 to 25 countries, with Egypt, Vietnam and Kenya, among others, having the largest weightings.

Key Latin American stock indexes and currencies: