EMERGING MARKETS-Brazil stocks slip on China PMI; Mexico down

Mon Apr 1, 2013 5:49pm EDT

Related Topics

* Steelmakers rise on CSN results
    * America Movil buybacks surge, curbing slump
    * Brazil Bovespa falls 0.8 pct; Mexico IPC down 0.3 pct


    By Asher Levine
    SAO PAULO, April 1 (Reuters) - Weak factory activity data
from China drove down Brazilian stocks on Monday on concerns of
softer demand for raw materials, while slower growth in factory
activity in the United States weighed on Mexican shares. 
    Following a market holiday on Friday, Brazil's benchmark
Bovespa stock index fell 0.8 percent to 55,902.18, after
having bounced back from an eight-month low last week. Volume on
Monday was the fourth lowest volume this year. 
    Shares fell after China's official purchasing managers index
for March rose less than expected. 
    China is Brazil's biggest trading partner and a key consumer
of Latin American commodities exports such as iron ore, soy,
copper and petroleum. Shares of iron ore mining giant Vale SA
, which counts China as its biggest customer, fell 2.5
percent, contributing the most to the Bovespa's drop.
    "We aren't going to see that 8 percent growth (in China)
anymore, the giant is beginning to slow and we need to adjust to
the new reality," said Alexandre Ghirghi, a partner with Metodo
Investimentos in Sao Paulo. 
    Steelmakers gained after Cia Siderurgica Nacional
, Brazil's second-largest producer of flat steel
products, posted better-than-expected fourth-quarter profits on
Thursday. 
    Preferred shares of CSN, as the company is known, rose 5.15
percent. Those of rival Usinas Siderurgicas de Minas Gerais SA
, known as Usiminas, climbed 5.27 percent. CSN
executives said in a conference call on Monday that the company
was interested in maintaining its investment in Usiminas.
 
     Shares of oil firm HRT ParticipaƧƵes em Petroleo SA
 soared 17.42 percent, the biggest one-day rise since
October, after the company said last week that it began an
offshore oil and gas drilling campaign in Namibia.
    Brazil's Bovespa has posted three straight monthly declines
and is down more than 8 percent this year, with investors citing
increased policy risk due to heavy government meddling in the
private sector last year.
    "We used to be the market darling three years ago, but
government intervention has led investors to look for returns in
other places," Ghirghi said. 
    Mexico's IPC index slipped 0.33 percent to 43,932.52
points after a market holiday on Thursday and Friday.
    Data showed U.S. factory activity grew at the slowest rate
in three months in March, and Mexico's closely-linked
manufacturers also posted the slowest growth in March in more
than a year.  
    Shares in America Movil, billionaire Carlos Slim's
flagship telecommunications company, shed 1.07 percent. Before
Monday's losses, the stock had rallied nearly 13 percent after
hitting a roughly four-year low on bets that concerns of tougher
regulation had been overblown.
    America Movil has been aggressively buying back shares to
support its share price, stepping up efforts in March after the
government presented a bill to strengthen telecommunications
regulations. The company spent 13.4 billion Mexican pesos ($1.09
billion) over 18 trading days in March, buying back more than 1
billion shares.
    On four days in March the company's buybacks accounted for
40 percent or more of the total trading volume in America Movil
 shares, according to Reuters data.
    The active buyback helped stave off a bigger slump in the
shares, which fell only 2 percent in March. The shares shed more
that 12 percent in the first quarter, hurt by a weak earnings
report.
    The company said last month it planned to increase its
buyback fund by 40 billion pesos this year. The plan will be
voted on at its annual shareholder meeting on April 30. Slim,
the world's richest man, and his family control America Movil's
voting stock, so the plan will likely be approved.
 
    Chile's IPSA index slipped 0.37 percent as shares of
conglomerate Copec fell 0.91 percent.

    Latin America's key stock indexes at 2100 GMT:
    
 Stock indexes                       daily   YTD %
                         Latest          %  change
                                    change  
 MSCI LatAm               3,788.84   -0.71   -0.24
                                            
 Brazil Bovespa          55,902.18    -0.8   -8.29
                                            
 Mexico IPC              43,932.52   -0.33    0.52
                                            
 Chile IPSA               4,415.69   -0.37    2.66
                                            
 Chile IGPA              21,627.13   -0.33    2.64
                                            
 Argentina MerVal         3,380.78   -1.06   18.45
                                            
 Colombia IGBC           14,043.33   -0.65   -4.57
                                            
 Peru IGRA               19,917.41    0.29   -3.45
                                            
 Venezuela IBC          629,100.63    1.49   33.44
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