December 3, 2012 / 2:55 PM / 5 years ago

EMERGING MARKETS-Brazil homebuilders gain, electric utilities eyed

* Brazil homebuilders up on bets for lower interest rates
    * Electric utility shareholders vote on concession renewals
    * Brazil Bovespa gains 1.33 pct, Mexico IPC up 0.48 pct

    By Asher Levine
    SAO PAULO, Dec 3 (Reuters) - Brazilian stocks rose on Monday
as expectations for a longer period of low interest rates fed
demand for homebuilders, though investors remained focused on
electric utilities as shareholders vote on concession renewal
plans.
    Mexico's IPC stock index rose in the first session
following the inauguration of President Enrique Pena Nieto,
while Chile's bourse gained for a third straight
session.
    Homebuilders drove gains in Brazil's Bovespa after Latin
America's largest economy posted far weaker than expected growth
numbers for the third quarter on Friday. 
    "When the GDP numbers came out, there was a perception that
one thing the government could do to increase growth is lower
interest rates...which would positively affect the construction
sector," said Luiz Roberto Monteiro, a broker at Renascenca
Corretora in Sao Paulo.
    Brazilian interest-rate futures fell across the board on
Monday, with the contract maturing in January 2014, one
of the most traded, down 11 basis points to 7.17 percent.
    Shares of homebuilder PDG Realty SA added 6
percent, contributing most to the index's gains, while rival
Gafisa SA added 4.5 percent.
    State-controlled power utility Centrais Eletricas
Brasileiras SA, known as Eletrobras, was little
changed after the company agreed to renew several concessions at
steeply lower rates on Monday, a move widely expected by
investors. 
    Other electric utilities such as Cteep and Cesp
 will also put the decision over concession renewals
to a vote on Monday. Shares in both firms rose over 4 percent.
    Also influencing the shares was a media report on Monday
that said Brazil's government could adjust the compensation it
offers to power generators under the concession renewal plan. 
    "We are still going to see a lot of volatility in the
(electric) sector due to the new compensation plans," Monteiro
said, adding that it would take time for the calculations to be
done and the share prices to settle.
    Vale edged 0.25 percent lower after the world's
second largest mining company said on Monday it will slash
capital expenditures by 24 percent in 2013. 
    Mexico's IPC index rose following Saturday's
inauguration of President Enrique Pena Nieto, who has promised
to end years of violence and sluggish economic growth.
 
    Shares of conglomerate Alfa rose 1.6 percent,
while those of cement manufacturer Cemex added 1.5
percent.
    Chile's IPSA index rallied for a third day, as
retailer Falabella and regional energy group Endesa
Chile gained 0.75 percent and 0.6 percent,
respectively.
    
    Latin America's key stock indexes at 1433 GMT:
 Stock indexes                           daily %      YTD %
                          Latest          change     change
 MSCI LatAm                  3,596.34       0.45      -0.61
                                                  
 Brazil Bovespa             58,239.49       1.33       2.62
                                                  
 Mexico IPC                 42,032.35       0.48      13.36
                                                  
 Chile IPSA                  4,157.39       0.42      -0.48
                                                  
 Chile IGPA                 20,387.62       0.31       1.28
                                                  
 Argentina MerVal            2,442.45       0.95      -0.82
                                                  
 Colombia IGBC              14,186.74       0.15      12.01
                                                  
 Peru IGRA                  20,199.40       0.77       3.73
                                                  
 Venezuela IBC             407,593.00          0     248.26

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