EMERGING MARKETS-Brazil stocks fall on GDP, electric utilities rise

Fri Nov 30, 2012 10:23am EST

* Brazil Q3 GDP growth much weaker than expected
    * Brazilian electric utilities up on government offer
    * Brazil Bovespa falls 1.3 pct, Mexico IPC down 0.29 pct

    By Danielle Assalve
    SAO PAULO, Nov 30 (Reuters) - Brazilian stocks slipped on
Friday after data showed Latin America's largest economy grew
far slower than expected in the third quarter, though shares of
electric utilities gained. 
    Mexico's IPC index fell its most in over a week,
while Chile's bourse gained for a second straight day.
    Brazil's economy expanded just 0.6 percent in the third
quarter from the second quarter, according to government data
released on Friday. That was half the pace expected by analysts
and below all forecasts in a Reuters poll. 
    "It was horrible, the number was half of what everyone was
expecting, just very bad," Jankiel Santos, chief economist with
BES Investimento in Sao Paulo.
    Brazil's benchmark Bovespa stock index fell as
shares linked to domestic demand, such as consumer goods
manufacturer Hypermarcas SA and retailer Lojas Renner
SA slipped. 
    Profit-takers sold off shares of steelmakers and mining
firms. Favorable analyst recommendations and rosier hopes for a
U.S. budget deal drove the shares higher in the previous
session.
    Shares of steelmaker Gerdau fell 3 percent, while
iron-ore miner Vale dropped 0.9 percent. Both stocks
rose their most in over a month on Thursday.
    Electric utilities lent support after Brazil's government
late Thursday offered greater compensation to the sector in
return for accepting sharply lower power rates as part of a
concession renewal deal. 
    "Even though the amount was less than what the companies
wanted, it's above what the government had proposed paying,"
said Joao Pedro Brugger, an analyst with Leme Investimentos in
Florianopolis, Brazil. "This was a victory for them, albeit
small, as they were able to exert a little pressure on the
government."
    Shares of Centrais Eletricas Brasileiras SA,
known as Eletrobras, jumped 20 percent and those of Companhia de
Transmissao de Energia Eletrica Paulista, known as
Cteep, rose 9 percent. 
    Shares of Brazil's state-run oil company Petrobras
 dropped 1.25 percent after the company cancelled an
order on Thursday for drill ships, cutting its $76 billion new
rig program by almost a fifth. 
    Mexico's IPC index fell as gains by retail giant
Wal-Mart de Mexico were unable to offset losses by
telecommunications firm America Movil. 
    Still, the index is on track to close the session with a
nearly 2.7 percent weekly gain, its best since early July.
    Chile's IPSA index gained 0.24 percent as shares of
fertilizer, lithium and iodine producer Soquimich 
rose 1 percent, contributing most to the index's gains.
    
    Latin America's key stock indexes at 1440 GMT:
 Stock indexes                           daily %      YTD %
                          Latest          change     change
 MSCI LatAm                  3,568.62      -0.72      -0.22
                                                  
 Brazil Bovespa             57,103.20       -1.3       0.62
                                                  
 Mexico IPC                 41,967.37      -0.29      13.19
                                                  
 Chile IPSA                  4,147.27       0.24      -0.72
                                                  
 Chile IGPA                 20,361.98       0.18       1.15
                                                  
 Argentina MerVal            2,411.90       0.15      -2.06
                                                  
 Colombia IGBC              14,138.41      -0.04      11.63
                                                  
 Peru IGRA                  20,101.35      -0.32       3.23
                                                  
 Venezuela IBC             408,271.50          0     248.84
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