EMERGING MARKETS- Vale drives Brazil stock rebound, Mexico slips

Wed Apr 3, 2013 7:27pm EDT

Related Topics

* Vale gains on bets of favorable court ruling
    * Mexican stocks fall off of over three-week high
    * Mexico IPC falls 0.9 pct, Brazil Bovespa up 1.2 pct


    By Asher Levine
    SAO PAULO, April 3 (Reuters) - Brazilian stocks bounced up
off a key support level on Wednesday to trade higher, backed by
bets that a legal ruling could throw out some $15 billion in tax
claims on iron miner Vale, while Mexican stocks slumped back
after a recent rally.
    Brazil's benchmark Bovespa stock index rose 1.23
percent to 55,562.74 as shares of iron-ore miner Vale SA
 climbed nearly 6 percent.
    Brazil's Supreme Court on Wednesday put off for a week a
decision on whether Vale must pay an estimated $15.2 billion in
taxes on earnings from its operations abroad. Vale shares gained
on bets that it might win its tax case, said Luciano Rostagno,
chief strategist with Banco WestLB in Sao Paulo. 
    State-controlled oil producer Petrobras could
also benefit from the ruling, and its stock rose 1.69 percent.
    Before Wednesday's rebound, the Bovespa had fallen to near
its lowest level in about eight months due to flagging
confidence in the local economy and worries over government
intervention in the private sector.
    "We are near a support level at 55,000 points and, if
external markets remain stable, we could see a rebound here,"
said Joao Pedro Brugger, an analyst with Leme Investimentos in
Florianopolis, Brazil.
    
    RECORD SHORTS 
    The amount of short-sales, or bets that Brazilian stocks
would fall, hit a record 89.4 billion Brazilian reals ($44.2
billion) worth of shares at the end of March, financial exchange
operator BM&FBovespa SA said in a monthly report on
Wednesday. 
    Shares of Brazilian homebuilder Gafisa SA jumped
6.67 percent after a local newspaper reported that the
debt-laden company had received four offers for its high-end
Alphaville unit. 
    Mexico's IPC index fell 0.9 percent to 43,717.57
points, pulling back from a more than three-week high.
    Shares declined after data on Wednesday showed U.S.
companies slowed their pace of hiring more than expected, while
another survey showed growth in the U.S. services sector in
March was the slowest in seven months. 
 
    "This was a very justified drop. Earnings are coming and in
the case of the United States, we are near record highs, just
around the levels that people see the indexes at year end," said
Gerardo Roman, head of stock trading at brokerage Actinver in
Mexico City.
    Shares of telecommunications firm America Movil,
controlled by billionaire Carlos Slim, slipped 1.8 percent while
top U.S. cement supplier Cemex shed 3.58 percent.
    Still, Friday's key U.S. monthly payrolls report, due on
Friday, is expected to show the economy gaining steam in
Mexico's top trading partner and a strong report could help
stocks climb, traders said. 
    Chile's IPSA index dropped for the third straight
session, falling 1.11 percent to its lowest since early January
as shares of retailer Falabella lost 3.44 percent. 
    
    
    Latin America's key stock indexes at 2200 GMT:

 Stock indexes                           daily   YTD %
                       Latest                %  change
                                        change  
 MSCI LatAm                   3,766.17   -0.04   -0.83
                                                
 Brazil Bovespa              55,562.74    1.23   -8.84
                                                
 Mexico IPC                  43,717.57    -0.9    0.03
                                                
 Chile IPSA                   4,347.35   -1.11    1.07
                                                
 Chile IGPA                  21,367.58   -0.82    1.41
                                                
 Argentina MerVal             3,305.97   -1.06   15.82
                                                
 Colombia IGBC               13,718.90   -2.17   -6.77
                                                
 Peru IGRA                   19,549.08   -0.78   -5.24
                                                
 Venezuela IBC              632,201.75    0.86   34.10
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