EMERGING MARKETS-Brazil stocks flat as U.S. 'fiscal cliff' offsets Europe deal

Thu Dec 13, 2012 9:56am EST

* U.S. budget discussions at impasse
    * EU agrees to single bank supervisor
    * Brazil Bovespa gains 0.17 pct, Mexico IPC down 0.1 pct

    By Asher Levine
    SAO PAULO, Dec 13 (Reuters) - Brazilian stocks were little
changed on Thursday as worries over the lack of a budget deal in
the United States offset signs of progress in Europe's debt
crisis.
    Mexico's IPC index also remained flat, while Chile's
bourse fell for the first session in three.
    Investors were focused on the budget debate in the United
States, where policymakers negotiated how to avoid the so-called
fiscal cliff of $600 billion in tax hikes and spending cuts due
to start in January, which could tip the world's biggest economy
into recession.
    Those concerns overrode optimism over a deal forged among
European Union policymakers on Thursday to establish a single
supervisor for the region's banks, seen as a key step towards
solving the region's debt crisis. 
    "Everything is hanging on what comes out of the fiscal cliff
discussions," said Gustavo Mendonca, an economist with Saga
Capital in Rio de Janeiro, Brazil. "Since (the EU deal) is still
missing details and the regulation isn't going to be as ample as
 expected, it didn't have much impact on the market." 
    Brazil's benchmark Bovespa stock index edged 0.17
percent higher to 59,577.95 points. 
    A 3.4 percent gain by Hypermarcas SA, the largest
Brazilian producer of consumer disposable goods, helped offset a
0.8 percent loss by state-controlled oil company Petroleo
Brasileiro SA, known as Petrobras.
    Shares of steelmaker Usinas Siderurgicas de Minas Gerais SA
, known as Usiminas, rose 3.73 percent as
bargain-hunters took advantage of Wednesday's 3.95 percent fall.
    Brazilian stocks will post steady gains through 2013 as the
global economy recovers, a Reuters poll found on Thursday, but
domestic investors will need to see stronger corporate results
before stepping back into local equities. 
    Mexico's IPC index reopened 0.1 percent lower after a
local holiday kept markets closed on Wednesday.
    A technical indicator known as the relative strength index
remained in "overbought" territory, however, indicating stocks
may be due to fall further in coming sessions.
    Mexican stocks are seen climbing above current record highs
next year, according to a Thursday Reuters poll. 
    Chile's IPSA index slipped for the first session in
three, losing 0.27 percent to 4,222.50.
    Industrial conglomerate Copec slipped 0.54 percent,
contributing most to the index's slide, while retailer Falabella
 dropped 0.26 percent.
    Latin America's key stock indexes at 1403 GMT:
 Stock indexes                           daily %      YTD %
                          Latest          change     change
 MSCI LatAm                  3,734.04       0.07       3.58
                                                  
 Brazil Bovespa             59,577.95       0.17       4.98
                                                  
 Mexico IPC                 43,140.64       -0.1      16.35
                                                  
 Chile IPSA                  4,222.50      -0.27       1.08
                                                  
 Chile IGPA                 20,686.34      -0.18       2.76
                                                  
 Argentina MerVal            2,612.10       0.04       6.07
                                                  
 Colombia IGBC              14,624.07      -0.04      15.46
                                                  
 Peru IGRA                  20,258.49      -0.07       4.03
                                                  
 Venezuela IBC             466,462.63          0     298.56
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