Mexican Bolsa Has Biggest Monthly Drop Since 2002
 Bloomberg
Mexico's benchmark stock index had its biggest monthly decline in almost three years as rising interest rates in the U.S. lured money from riskier assets such as emerging market equities.
Mexico's Bolsa index has fallen 8.1 percent this month, the first monthly drop since July and the largest decline since June 2002. Corporacion Interamericana de Entretenimiento SA, Mexico's largest live entertainment provider, led the monthly drop, plunging 29 percent. Today the Bolsa index was little changed, rising 0.02 percent to 12,655.62 at 3:40 p.m. New York time. Stock markets fell throughout the region in March, with Brazil's Bovespa index sinking 5.2 percent and Argentina's Merval index dropping 10.2 percent, its biggest decline in 10 months. U.S. Federal Reserve policy makers last week said they're concerned inflation is picking up in the U.S., suggesting they may accelerate the pace of interest-rate increases. The Fed has raised its benchmark rate seven times since June, bringing the rate to 2.75 percent.
"That was bad for emerging markets,'' said Claudia Hardy, who helps manage $800 million in Mexican stocks for a joint venture between SEI Investments Co. and Compass Group. "We expect the Mexican Bolsa to recover from its current levels primarily because we believe the valuation is attractive.''
Morgan Stanley's index of Latin American stocks fell 9.4 percent in the month. It rose 1.4 percent today.
The following stocks are making significant gains or losses in Latin American markets today. Symbols are in parentheses after the company name. In Brazil, the preferred share is usually the company's most-traded class of stock.
Mexico
Grupo Mexico (GMEXICOB MM) rose 1.05 pesos, or 1.8 percent, to 58.55 pesos. The company this week completed a reorganization of assets that left Grupo Mexico with a 75 percent stake in the second-biggest copper producer by market capitalization on the New York Stock Exchange. The plan moved ahead after shareholders of its Southern Peru Copper Company unit approved purchase of another Grupo Mexico unit, Minera Mexico, for about $3.6 billion.
Wal-Mart de Mexico SA (WALMEXV MM), Latin America's largest retailer, rose 20 centavos, or 0.5 percent, to 39.28 pesos. Eduardo Solorzano, Walmex's chief executive, told reporters in Mexico City yesterday the company has identified 200 Mexican cities where it doesn't have a store and could possibly expand to keep up revenue growth.
Corporacion Interamericana de Entretenimiento (CIEB MM) rose 19 centavos, or 0.8 percent, today to 22.85 pesos, cutting its losses in the month to 29 percent.
Brazil
Banco do Brasil SA (BBAS3 BS), Latin America's largest bank, rose 51 centavos, or 1.8 percent, to 29.30 reais. Renato Prado, analyst with Fator Doria Atherino brokerage, increased his recommendation for the stock to "attractive'' from "hold'' due to the strong gain potential, he wrote in a report. The weak performance in the fourth quarter is already priced in, Prado said. The stock is down 21 percent since Feb. 21, when the result was published.
Banco Itau Holding Financeira SA (ITAU4 BS), Brazil's biggest by market value, rose 3.49 reais, or 0.8 percent, to 432.49 reais. Itau is set to increase loans about 20 percent this year, Chief Executive Roberto Setubal said.
Empresa Brasileira de Aeronautica SA (EMBR4 BS), the world's fourth-biggest aircraft maker, rose 41 centavos, or 2 percent, to 20.80 reais. Embraer, as the company is known, is studying development of smaller business jets as it seeks to meet growing demand for executive planes in the next decade, Chief Executive Mauricio Botelho said today at a news conference in Sao Paulo.
Usinas Siderurgicas de Minas Gerais (USIM5 BS), or Usiminas, the country's largest provider of steel to the local car industry, rose 45 centavos, or 0.8 percent, to 57.10, reducing the drop in the month to 17 percent, still the second-largest among Bovespa's 53 members.
Chile
Sociedad Quimica y Minera de Chile SA (SQM/B CC), Chile's biggest fertilizer maker, rose 145 pesos, or 3.1 percent, to 4,765 pesos. Prices for products that the company produces could rise, such as iodine and lithium, increasing its profit, said Rodrigo Cristi, analyst at brokerage Alfa Corredores de Bolsa SA in Santiago. The stock has risen 39.5 percent in the year.
Lan Airlines SA (LAN CC), Chile's biggest airline, rose 85 pesos, or 2.1 percent, to 4,130 pesos. The company would increase its profit as it's acquiring an airline in Argentina, expanding its operations in the region, Cristi said. |
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Business News | April 2005 
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