EMERGING MARKETS-Most Latam stocks, FX extend gains as slowing coronavirus cases brew optimism

    * Mexican peso up 2.4%, annual inflation eases in March
    * Fitch downgrades Argentina after payments freeze
    * Chile March exports fall; 7.6% drop in value of copper
shipments

 (Updates prices)
    By Susan Mathew and Ambar Warrick
    April 7 (Reuters) - Latin American assets extended their
recovery into a second session on Tuesday, as risk assets were
propped up by hopes that the coronavirus outbreak had peaked in
several hotspots. 
    Data showing that new infections were slowing across several
U.S. states, coupled with a lower rate of deaths in several
European countries, led many to believe that the virus would
plateau.
    "If the incipient recovery in risk appetite and commodity
prices continues and ... the global economy starts to recover in
the second half of the year, most EM currencies will probably
recover more of the ground they have lost this year," said Jonas
Goltermann, senior economist at Capital Economics. 
    Brazil's real added 1.3%, while the Colombian peso
 rose 1.9% against a weaker dollar. 
    Mexico's peso rose almost 2%, bouncing from last
session's record. On Tuesday, data showed Mexican consumer
prices eased in March closer to the central bank's 3% target
rate and below analyst expectations. 
    "(The inflation number) should ease near-term concerns at
the central bank about the impact of the weakness of the peso on
prices," wrote analysts at Capital Economics in a note. 
    "With the economy likely to enter a deep recession due to
the coronavirus and the government seemingly doing little to
help, interest rates are likely to be lowered sharply. We’ve
penciled in 200 basis points of cuts this year."
    Most regional stocks rallied, taking MSCI's index of Latam
stocks xx% higher. But, in line with the United
States, stocks pared some gains as caution prevailed over the
likelihood of a deep global recession.
    Argentine stocks slipped, however, looking to break
a five-session wining streak.
    Rating agency Fitch downgraded Argentina following
postponement of upcoming payments on foreign currency debt by
the government. A poll by Argentina's central bank showed
economists see the outlook darkening.
    Brazil's Bovespa surged around 3.5%. State-run oil
and gas behemoth Petroleo Brasileiro rallied after it
approved lower oil production in April than from the same month
a year ago.
    Colombian stocks added 0.5% in its fourth straight
session of gains, while Mexican shares rose 1.2%. 
    Still, the gains were a fraction of what was lost over a
month-long rout. 
    Chile's peso and stocks weakened. Data
showed imports plunged in March, while exports fell as the value
of copper shipments dropped 7.6%. Chile is the world's largest
copper producer.
    
    Latin American stock indexes and currencies 1930 GMT:
  Stock indexes           Latest   Daily %
                                   change
 MSCI Emerging Markets     879.08     2.96
                                   
 MSCI LatAm               1626.54     3.36
                                   
 Brazil Bovespa          76664.90      3.5
                                   
 Mexico IPC              34779.92     1.16
                                   
 Chile IPSA               3738.67    -0.26
                                   
 Argentina MerVal        26695.42   -0.844
                                   
 Colombia COLCAP          1165.36     0.45
                                   
                                          
      Currencies          Latest   Daily %
                                   change
 Brazil real               5.2190     1.36
                                   
 Mexico peso              24.1641     1.91
                                   
 Chile peso                 854.1    -0.46
                                   
 Colombia peso            3907.17     1.85
                                   
 Peru sol                  3.3628     0.80
                                   
 Argentina peso           65.0675    -0.12
 (interbank)                       
                                   
 
 (Reporting by Ambar Warrick in Bengaluru; Editing by Sandra
Maler and Grant McCool)
  

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