Mexican stocks end with marginal 0.19 pct loss
Reuters Story - January 06, 2000 17:58
By Cyntia Barrera Diaz
MEXICO CITY, Jan 6 (Reuters) - Mexican stocks closed lower on Thursday as investors booked profits earned during a rally in December, amid worries U.S. interest rates may soon head higher, traders said.
In late trading, stocks bounced off their session lows amid nervous flows which kept the bolsa meandering throughout the session. But stocks failed to close in positive territory, with the key IPC index of 35 most-traded issues closing down 12.66 points, or 0.19 percent, at 6751.65 points.
During the session, the IPC bottomed at 6742.91 points and peaked at 6822.46 points.
"We were expecting volatility at the beginning of the year after hitting records," during the last trading days of 1999, said Bancomer brokerage head of research, Carlos Samano. Mexican stocks firmed 16.19 percent in December, according to bolsa records.
This week, Mexican stocks have dipped 5.30 percent from 1999's record-high close of 7129.88 points. Tuesday's 5.69 percent fall was the market's worst one-day percentage loss in more than a year.
Growing worries that the Federal Reserve will raise U.S. interest rates in the coming months triggered the selloff, traders said. Federal Reserve policy makers will next meet to decide on interest rates early in February.
"The rate issue, combined with the fact that Mexican shares had strengthened so much during the last weeks of 1999, was used as a vehicle to cash some profits," said one trader from a local bank.
Higher U.S. rates would pressure stock prices on both sides of the border. Rate hikes by the Fed would also pressure consumer spending in the United States, reducing demand for goods made in Mexico.
Unlike other sessions where Mexico closely follows steps from the Dow Jones, on Thursday local stocks ignored a rise of 1.17 percent on the key U.S. index, market watchers said.
Despite the market's weakness, Mexico's central bank governor Guillermo Ortiz said Thursday that the "episode of volatility does not mean a difficult situation for us."
Investors also moved to the sides ahead of Friday's release of key U.S. job data that is expected to give a clearer picture on the future of rates.
A weaker volume on the overall market of 73.48 million shares, against Wednesday's 145 million, reflected investor cautiousness.
Decliners outpaced gainers by 46 to 28 while 19 issues ended unchanged.
Bellwether Telefonos de Mexico (Telmex), with a 26.38 percent weight in the IPC Thursday, closed 0.35 peso higher, or 0.71 percent, at 49.75 pesos.
The firm's ADRs inched up 11/16 to 104 on Wall Street. an
Despite erratic trade on the telephone giant's stock, a morning Merrill Lynch upgrade to near-term buy from accumulate on Telmex stopped the firm from ending in negative ground, traders said.
Grupo Televisa, Mexico's No. 1 broadcaster, rose 0.50 peso to 271 pesos per CPO share but its ADRs slipped 13/16 to 56-5/16 on Wall Street.
After setting a new life-high at 21.35 pesos per V share, retailer Cifra, the third most heavily weighted issue in the IPC Thursday, finished 0.15 peso lower at 20.70 pesos.
Other helpful Mexican market information: * Main percentage gainers * Main percentage decliners * Most traded shares * Market statistics * Mexican ADRs * Mexican ADRs/Bolsa equivalent * Mexican futures (MexDer) * Mexican peso * Mexican peso bids * Mexican Cetes rates * Mexican indicators forecast * Indices display * Sector display * Warrants * Buyer/Seller IDs * Brokerage characters * Detailed information * Mexican market overview * Mexican oil prices * Domestic guide * Country news [MX] Other Latin American markets: * Argentina's MerVal * Brazil's Bovespa * Chile's IPSA * Peru's IGRA * Venezuela's IBC <.IBC
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