January 15, 2013 / 3:05 PM / in 5 years

EMERGING MARKETS-Latam stocks down on U.S. debt talk concerns

4 Min Read

* Bernanke warns of risks if debt negotiations stall
    * Petrobras rises on report of fuel price hike
    * Brazil Bovespa falls 0.32 pct, Mexico IPC down 0.16 pct

    By Asher Levine
    SAO PAULO, Jan 15 (Reuters) - Brazilian stocks slipped on
Tuesday as investor concern over debt negotiations in the United
States kept risk appetite muted.
    Banking firms weighed on Mexico's IPC index while
Chile's bourse edged down, tracking global markets lower
as investors monitored negotiations among U.S. policymakers to
raise the $16.4 trillion debt ceiling.
    Federal Reserve Chairman Ben Bernanke said on Monday that
any failure to reach an accord could put a recovery in the
world's largest economy at risk. Credit ratings firm Fitch also
said the U.S. faces a "material risk" of losing its triple-A
status if negotiations stall.
    "The market is locked up because of what Bernanke and Fitch
said," said Álvaro Bandeira, a partner with Orama Investimentos
in Rio de Janeiro. "(Policymakers) will eventually resolve this,
but it's bringing volatility and stress to the market."
    Brazil's benchmark Bovespa stock index fell 0.32
percent to 61,881.08, returning some of the previous session's
nearly 1 percent gain.
    "Despite today's fall, the trend is still for a gain," said
Daniel Marques, a technical analyst with Agora Corretora in Rio
de Janeiro. "Volume is strong and we should hit a yearly high
soon, though much will depend on what happens in the United
States."
    Shares of OGX Petroleo e Gas Participacoes SA,
the oil company controlled by Brazilian billionaire Eike
Batista, fell 2.8 percent and contributed most to the index's
losses. The stock had rallied to a more than 11 percent gain
over the previous 3 sessions.
    Losses in the index were partially offset by shares of
state-controlled oil company Petroleo Brasileiro SA,
known as Petrobras. The heavily-weighted stock rose 0.25 percent
after a local newspaper reported on Tuesday that Brazil's
government may authorize a fuel price increase next week, which
would help support Petrobras' bottom line. 
    Shares of homebuilder Gafisa SA jumped 6 percent
after the company reported a strong rebound in new launches and
sales in the fourth quarter, according to a Monday filing. 
    Gafisa shares look attractive after the company generated
more free cash flow than expected by reselling low-income units
with previously canceled contracts, analysts at Bank of America
Merrill Lynch told clients in a Tuesday note. 
    Mexico's IPC index dropped for the second straight
session, losing 0.16 percent to 44,791.97. Shares of lender
Grupo Financiero Inbursa fell 1 percent,
contributing most to the index's losses, though retailer
Wal-Mart de Mexico lent support, rising 0.31
percent.
    Chile's IPSA index fell for the second session in
three, losing 0.16 percent to 4,447.90 as shares of regional
energy group Endesa Chile slipped 0.75 percent.
    
    Latin America's key stock indexes at 1443 GMT:
    
 Stock indexes                          daily %     YTD %
                          Latest         change    change
 MSCI LatAm                  3,906.79      -0.6      3.49
                                                 
 Brazil Bovespa             61,881.08     -0.32      1.52
                                                 
 Mexico IPC                 44,791.97     -0.16      2.49
                                                 
 Chile IPSA                  4,447.90     -0.16      3.41
                                                 
 Chile IGPA                 21,717.23     -0.13      3.07
                                                 
 Argentina MerVal            3,080.91     -0.46      7.94
                                                 
 Colombia IGBC              14,745.91     -0.07      0.20
                                                 
 Peru IGRA                  21,808.64     -0.28      5.72
                                                 
 Venezuela IBC             473,704.28         0      0.48

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