EMERGING MARKETS-Latam stocks fall as Petrobras weighs

Mon Oct 29, 2012 10:18am EDT

Related Topics

* Petrobras Q3 results well below expectations
    * Bovespa gives up gains for the year
    * Brazil's Bovespa falls 0.92 pct, Mexico's IPC down 0.18 pct

    By Asher Levine
    SAO PAULO, Oct 29 (Reuters) - Latin American stocks fell on Monday as shares
of regional oil giant Petrobras weighed on Brazil's Bovespa following weaker
third-quarter results than had been expected.
    The MSCI Latin American stock index fell for the second
straight session, losing 0.88 percent to 3,646.48 and crossing below its 75-day
simple moving average, a level that has provided support since early September.
    Trading volumes were low, with stock markets in New York closed due to an
approaching hurricane. 
    Brazil's benchmark Bovespa stock index dropped 0.92 percent to
56,751.89 points, erasing its gains for the year and falling to its lowest level
in nearly eight weeks.
    Petrobras preferred shares slid 3.21 percent to 21.39 reais after
the state-controlled oil company reported lower-than-expected third-quarter
income late on Friday.
    Petrobras said its quarterly profit fell as refining unit losses rose, an
unexpected result after being granted its first wholesale fuel-price increase in
six years in June. 
    "I don't see a very positive situation for Petrobras," said Deborah Morsch,
a partner with Zenith Asset Management in Porto Alegre, Brazil. "The shares will
continue to be pressured due to the increase in production costs and
investments."
    Shares of Gol Linhas AĆ©reas, Brazil's second-largest airline,
slipped 0.4 percent after a local newspaper reported on Monday that the company
plans to continue reducing domestic flights into 2013 and focus on expanding
international flights, especially to the United States. 
    Fibria, the world's largest producer of eucalyptus pulp, gained 1
percent after the company on Monday reported earnings before interest, taxes,
depreciation and amortization, a gauge of operating profit known as EBITDA, rose
20 percent from a year earlier. 
    Brazil's Bovespa fell in seven of the previous eight sessions as
weaker-than-expected corporate earnings both domestically and abroad dampened
investor optimism over a global economic recovery.
    "The market could fall more. Results for the fourth quarter could be weak
because many people are making year-end purchases earlier due to government tax
incentives," Morsch said, adding that she sees the Bovespa dipping below 55,000
points by the end of the year.
    Mexico's IPC index fell for the third straight session, dipping 0.18
percent to 41,759.66.
    Shares of telecommunications firm America Movil, controlled by
billionaire Carlos Slim, lost 0.36 percent, contributing most to the index's
loss, while mining firm Grupo Mexico fell 0.6 percent.
    Chile's IPSA index traded nearly flat, with gains by industrial
conglomerate Copec offsetting losses by Banco de Chile.
    
    Latin America's key stock indexes at 1331 GMT:
 Stock indexes               Latest    Daily pct    YTD pct
                                          change     change
 MSCI Latam                  3,646.48      -0.88       2.12
                                                  
 Brazil Bovespa             56,751.89      -0.92       0.00
                                                  
 Mexico IPC                 41,759.66      -0.18      12.63
                                                  
 Chile IPSA                  4,248.23      -0.05       1.69
                                                  
 Chile IGPA                 20,833.15      -0.01       3.49
                                                  
 Argentina MerVal                0.00          0    -100.00
                                                  
 Colombia IGBC              15,153.21       0.07      19.64
                                                  
 Peru IGRA                  21,010.51        0.2       7.89
                                                  
 Venezuela IBC             359,892.72          0     207.51
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