EMERGING MARKETS-Brazil stocks rise to key level; Mexico gains

Wed Jan 23, 2013 6:31pm EST

Related Topics

* Brazil's Bovespa stuck near 62,000 points
    * Mexican stocks clock record high
    * Bovespa up 0.44 pct; Mexico IPC adds 0.27 percent


    By Danielle Assalve and Jean Arce
    SAO PAULO/MEXICO CITY, Jan 23 (Reuters) - Brazilian stocks
edged up on Wednesday to just shy of a technical barrier that
could limit further gains, while Mexican stocks hit a record
high.
    A vote by U.S. lawmakers to allow the federal government to
keep borrowing money through mid-May eased concerns that
uncertainty about the issue would weigh on global markets in the
short term.
    Even so, the news was not enough to attract strong flows
into Brazilian stocks.
    "This is just a Band-Aid. It does not solve the problems of
the U.S. economy," said Luiz Roberto Monteiro, a trader at
brokerage Renascença in Sao Paulo.
    The United States is one of Latin America's top trading
partners, and the outlook for its economy is a major influence
on local stock markets
    Brazil's Bovespa stock index rose 0.44 percent to
61,966.26 points. It has remained range-bound between 61,500
points and 62,000 points for more than two weeks.
    Shares of OGX Petroleo e Gas Participacoes SA,
the oil company controlled by Brazilian billionaire Eike
Batista, rose 4.19 percent.
    Paper producer Klabin shares rose 4.55 percent
after Itau Unibanco analysts said in an investor note that the
outlook for earnings appear positive.
    Banco Votorantim analysts in an investor note said that
until the Bovespa can decisively break past 62,280, it may be
more likely to slip back to between 61,480 to 60,590 points.
    Brazil, Latin America's top economy, has lagged other major
stock markets such as Mexico as well as growing markets like
Colombia, with investors rattled by sluggish growth and rising
inflation.
    Strategists at Morgan Stanley & Co said in a Tuesday report
that the balance between risk and reward in Brazil's stock
market has deteriorated following a 9 percent rally since late
November. 
    Mexico's IPC index rose 0.27 percent to a record-high
close of 45,442.98 points.
    Mexican stocks have been notching record highs since last
year as solid U.S. demand supports Latin America's second
biggest economy and investors bet that a new government in
Mexico could push forward key energy and tax reforms.
    Carlos Ponce, an analyst at brokerage Ve Por Mas, said the
high valuations in the market made stocks vulnerable to profit
taking, but he noted that foreign investors continue to be
optimistic about Mexican stocks.
    "When you talk to some international participants, they
justify the high valuations with the decreasing risk they see in
the country," Ponce said. 
    Copper miner Grupo Mexico added 1.49 percent
to close at a record high while retailer Wal-Mart de Mexico
 rose 0.70 percent.
    
    Latin America's key stock indexes at 2300 GMT:
    
 Stock indexes                      daily %    YTD %
                                     change   change
                         Latest              
 MSCI LatAm               3,946.34     0.23     3.91
                                             
 Brazil Bovespa          61,966.26     0.44     1.66
                                             
 Mexico IPC              45,442.98     0.27     3.97
                                             
 Chile IPSA               4,510.95    -0.54     4.87
                                             
 Chile IGPA              21,992.20    -0.39     4.38
                                             
 Argentina MerVal         3,300.86    -0.16    15.65
                                             
 Colombia IGBC           14,868.84     0.32     1.04
                                             
 Peru IGRA               21,651.73     0.12     4.96
                                             
 Venezuela IBC           477,873.1    -1.04     1.37
                                 9
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