UPDATE 1-EMERGING MARKETS-Brazil stocks up on govt stimulus, Mexico down

Fri Apr 5, 2013 9:14pm EDT

* Brazil's Bovespa gains 0.74 pct on tax break announcement
    * Mexico IPC drops 0.74 pct on U.S. payrolls
    * U.S. payroll data weaker than expected in March


    By Asher Levine and Jean Arce
    SAO PAULO, April 5 (Reuters) - Brazilian stocks rose after
the government promised to extend tax breaks to boost
investment, while stocks fell elsewhere in Latin America on data
showing U.S. employers hired at a slower-than-expected pace in
March.
    Mexican and Chilean shares tracked global markets lower
after data showed employers in the United States hired at the
slowest pace in nine months in March, casting doubt over the
strength of a recovery in the world's largest economy. 
    Brazil's benchmark Bovespa stock index rose 0.74
percent to close at 55,050.60, after the government announced
that it will reduce taxes for construction, engineering, railway
and electricity companies. 
    Construction firm PDG Realty contributed most to
the index's gains, rising 6.67 percent, while homebuilder Gafisa
 rose 5.22 percent. Earlier in the session, the
Bovespa touched its lowest level since late July.
    "It was a crazy day in the market," said Carlos Nielebock, a
trader at ICAP in Sao Paulo, Brazil. He said the electric sector
rose on the government's tax measure announcement but noted that
investor skepticism continued to weigh on OGX Petroleo e Gas
Participacoes SA. 
    It "is the same thing we saw yesterday: it's a lack of trust
in the company and the stock," he said. 
    Shares of the oil producer, owned by billionaire Eike
Batista, sank to their lowest price since their market debut in
2008, closing down 13.64 percent after losing nearly 11 percent
on Thursday.  
    The slump came two days after Standard & Poor's lowered its
credit rating on the company to "B minus" from "B" citing
concerns over production levels.    
    The weak U.S. jobs data weighed heavily on Mexico's stock
market, with Mexico's IPC index falling 0.74 percent to
42,244.25.
    The United States is Mexico's no. 1 trade partner and
Mexico's stocks often rise or fall based on the outlook for
economic growth in its northern neighbor.
    "From this, you see more moderate growth in the United
States economy and as a consequence that is reflected in lower
growth for Mexico," said Gerardo Copca, an analyst at
MetAnalisis, a consultancy based in Mexico City. 
    Shares of financial group Banorte fell 4.22
percent, weighing most on the index, after Bloomberg news
reported Mexico's fourth largest bank is planning to raise about
$2 billion through a share offering this year.
    Banorte disputed that account in a statement filed with the
Mexican stock exchange later on Friday.
    In the statement, the bank said that "there does not exist
nor has any application been presented before the relevant
authorities for an public offering."
    Banorte added that while it has not sought the required
shareholder assembly approval for such an offering, it is
"constantly" evaluating options to raise capital.
    Shares of retail giant Wal-Mart de Mexico 
slipped 1.77 percent, while shares of telecommunications firm
America Movil, controlled by billionaire Carlos Slim,
dropped 1.04 percent.
    Mexico's competition watchdog said late Thursday that
America Movil unit Telcel dominates the country's phone market,
opening the door to tougher regulation of the firm.
 
    Chile's IPSA index retreated for the fifth straight
session, losing 1.3 percent to 4,270.82 as shares of retailer
Falabella fell 1.52 percent.
    
    Latin America's key stock indexes at 2152 GMT:
 Stock indexes                  daily %       YTD % change
                                 change  
                    Latest               
 MSCI LatAm         3,756.7        0.61              -1.08
                          4              
                                         
 Brazil Bovespa     55,050.        0.74              -9.68
                         60              
 Mexico IPC         43,244.       -0.74              -1.06
                         25              
 Chile IPSA         4,270.8        -1.3              -0.71
                          2              
 Chile IGPA         21,041.       -1.06              -0.14
                         48              
 Argentina MerVal   3,312.8        0.47              16.06
                          0              
 Colombia IGBC      13,742.       -0.45              -6.61
                         97              
 Peru IGRA          19,509.        -0.5              -5.43
                         57              
 Venezuela IBC      633,887        0.18              34.46
                        .75
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