EMERGING MARKETS-Mexico stock market drops most in month on telecoms

Wed Mar 13, 2013 11:37am EDT

Related Topics

* Telecoms reform bill pressures America Movil, Televisa
    * Bovespa volatile ahead of share options expiration
    * Mexico IPC down 0.96 pct, Brazil Bovespa falls 0.3 pct

    By Asher Levine
    SAO PAULO, March 13 (Reuters) - Mexican stocks fell their
most in a month on Wednesday as investors continued to sell off
telecommunications shares following a recent government proposal
aimed at stoking greater competition in the sector.
    Brazil's benchmark Bovespa index edged lower though
swung widely through the session as investors positioned for
Monday's expiration of share options.
    Mexico's IPC index dropped for the third straight
session, losing 0.96 percent to 43,545.21, the biggest
percentage drop since Feb. 13, as shares of telecommunications
firm America Movil, controlled by the world's richest
man, Carlos Slim, fell 3.7 percent.
    America Movil shares have lost over 9 percent this week
after Mexico's government issued a proposal on Monday that would
allow increased foreign ownership of media and phone companies
and give regulators the power to make players controlling more
than 50 percent of the market sell assets. 
    The proposal also led to a drop in shares of broadcasting
giant Grupo Televisa, which fell 1.6 percent on
Wednesday.
    Fund managers and traders said uncertainty over how the
reforms will be implemented could put further pressure on the
share prices of both companies, which currently dominate their
respective markets. 
    Brazil's Bovespa index fell for the third session in four,
losing 0.3 percent to 58,032.79. 
    Iron-ore mining firm Vale SA dropped 1.5 percent,
contributing most to the index's losses, though state-run oil
producer Petroleo Brasileiro SA, known as Petrobras,
rose 1.3 percent.
    "The expiration of options on Monday is weighing on the
index a bit," said Hamilton Alves, a senior analyst with BB
Investimentos in Sao Paulo. "That is leaving things quite
volatile, especially Vale and Petrobras, due to the intense
fight between those who are either long or short on the shares."
    Shares of planemaker Embraer SA rose 2 percent
after the company posted a bigger-than-expected jump in
operating profit late Tuesday, boosted by a more favorable
exchange rate and lower payroll taxes. 
    "At the end of 2011 we had few people recommending
(Embraer)shares," said Joao Pedro Brugger, an analyst with Leme
Investimentos in Florianopolis, Brazil. "In fact we saw good
results, the more stable exchange rate helps the predictability
of the company's performance, and it has showed itself as a good
investment."
    Chile's IPSA index lost 0.34 percent to 4,490.88,
with industrial conglomerate Copec down 1 percent and
contributing most to the index's losses.
   
    Latin America's key stock indexes at 1503 GMT:
 Stock indexes                            daily %     YTD %
                                Latest     change    change
 MSCI LatAm                    3,891.67     -0.25      2.73
                                                   
 Brazil Bovespa               58,032.79      -0.3     -4.79
                                                   
 Mexico IPC                   43,545.21     -0.96     -0.37
                                                   
 Chile IPSA                    4,490.88     -0.34      4.41
                                                   
 Chile IGPA                   21,974.83     -0.29      4.29
                                                   
 Argentina MerVal              3,395.72      0.27     18.97
                                                   
 Colombia IGBC                14,449.98     -0.23     -1.81
                                                   
 Peru IGRA                    20,119.97     -0.49     -2.47
                                                   
 Venezuela IBC               633,467.19      0.28     34.37
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