EMERGING MARKETS-Brazil stocks hit over 3-month low, break support
* Brazilian stock index technical outlook darkens * Brazil Bovespa down 1.56 pct, Mexico IPC up 0.63 pct By Danielle Assalve SAO PAULO, Nov 16 (Reuters) - Brazilian stocks dropped to a more than three-month low on Friday, closing below a support level that could augur for a steeper fall ahead, while Mexican stocks tracked Wall Street higher. The MSCI Latin American stock index fell 0.72 percent to close at its lowest level since July. Brazilian stocks slumped nearly 3.5 percent this week after data showed weaker than expected retail sales in September in Latin America's top economy while economic activity slipped that same month for the first time in five months. The data cast doubt on the strength of Brazil's economic recovery while disappointment with some quarterly earnings also weighed on sentiment. Brazil's benchmark Bovespa index lost ground for the sixth session in seven, dropping 1.56 percent on Friday to close at 54,402.33, below an important support level at 56,200. "The Bovespa index's short-term outlook continues to get worse," analyst Daniel Marques at brokerage Agora wrote in a report. "The break could lead to a sell-off in search of the year's low at 52,200," or another 4 percent lower. Brazil's state-run power utility Eletrobras posted an 11.5 percent drop, its biggest loss since November 2008, after the company said it will forgo 9.6 billion reais ($4.7 billion) in annual revenue as a result of government plans to cut power rates. TIM Participacoes, Brazil's No. 2 wireless carrier, fell 5.11 percent as regulators ordered the wireless carrier to stop selling a flat-rate promotional plan because of concerns about service quality. Homebuilder PDG Realty fell 7.32 percent to a six-month low as its chief executive said the company may have to account for more of the cost overruns that triggered losses in recent quarters. Mexico's IPC index reversed early losses to rise 0.63 percent to 40,830.60 points as retailer Wal-Mart de Mexico rose 1.27 percent while copper miner Grupo Mexico added 1.76 percent. Talks between U.S. President Barack Obama and congressional leaders eased some worries about the U.S. government's fiscal problems, helping Wall Street and Mexico rise after Brazil's market had closed. Mexico sends most of its exports to its northern neighbor and stronger than expected U.S. demand has helped shield Mexico from a wider global slowdown. Data on Friday showed Latin America's second biggest economy slowed in the third quarter, but was still on track to grow nearly 4 percent this year, underscoring the relative strength of the economy and its attraction to investors. Mexico's top cement maker Cemex slipped 0.26 percent as its affiliate Cemex Latam Holdings debuted on the Colombian stock exchange with a 2.04 percent loss. Earlier this month, Cemex, one of the world's top cement makers, said it had raised about $1.1 billion by selling a bigger-than-expected stake of its Latam unit in a Colombian initial public offering. Latin America's key stock indexes at 2330 GMT: Stock indexes daily % year-to Latest change date % change MSCI LatAm 3,502.23 -0.72 -2.78 Brazil Bovespa 55,402.33 -1.56 -2.38 Mexico IPC 40,830.60 0.63 10.12 Chile IPSA 4,184.85 -0.05 0.18 Chile IGPA 20,539.78 0 2.04 Argentina MerVal 2,283.09 -1.68 -7.29 Colombia IGBC 14,093.91 -0.70 11.28 Peru IGRA 20,044.00 -0.25 2.93 Venezuela IBC 383,419.13 1.51 227.61
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