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EMERGING MARKETS-Latam stocks fall as investors look past US elections
November 7, 2012 / 4:00 PM / in 5 years

EMERGING MARKETS-Latam stocks fall as investors look past US elections

* U.S. "fiscal cliff" eyed after election
    * Weak German industrial growth, Greek vote weigh on global markets
    * Brazil's Bovespa falls 1.29 pct, Mexico's IPC down 0.5 pct

    By Asher Levine and Danielle Assalve
    SAO PAULO, Nov 7 (Reuters) - Latin American stocks slid by the most in over
two weeks on Wednesday as investors turned their attention away from U.S.
elections and toward the ongoing fiscal problems plaguing the euro zone and the
United States.
    The MSCI Latin American stock index shed 1.37 percent, with
commodities firms driving Brazil's Bovespa index to its biggest loss in
two weeks and telecoms firm America Movil weighing on Mexico's bourse
    Profit-taking led shares lower in early trading on Wednesday, a day after
investors betting on a swift conclusion to the U.S. presidential election drove
Latin American stocks to their highest level in two weeks.
    Lingering fears over a stalemate in the tightly-contested race were assuaged
with the re-election of U.S. President Barack Obama to a second term, though
investors remain focused on the impending fiscal cliff of tax hikes and spending
cuts that could throw the world's largest economy back into recession.
    "What markets feared more than anything else was stalemate, particularly in
the context of the fiscal cliff," said Neil Shearing, Chief Emerging Markets
Economist with Capital Economics in London. "Since then we've had weak data out
of Europe and that has seemed to take the shine off the market." 
    Investors remained cautious Wednesday after data showed German industrial
output fell more than expected in September, while Greece's parliament prepared
to vote on a controversial round of spending cuts and tax hikes, approval of
which is crucial to unlocking fresh international aid.
    Brazil's benchmark Bovespa stock index dropped 1.29 percent to 58,694.06
points. A technical momentum indicator approached a "bearish cross" in
overbought territory, suggesting stocks may fall further in coming sessions.
    "Volatility will likely persist in the Bovespa as the probable fight over
the fiscal cliff will be ugly for markets," said Marc Sauerman, a manager with
JMalucelli Investimentos in Curitiba, Brazil.
    Shares of the most widely-traded commodities firms weighed heavily on the
Bovespa, with shares of state-controlled oil company Petrobras and
mining giant Vale down 1.9 percent and 1.2 percent, respectively. 
    BM&FBovespa SA, the world's third-largest exchange, fell 1.9
percent after the company missed third-quarter profit estimates on Tuesday, with
revenue down for the first time this year and expenses rising more than
    Mexico's IPC index slipped 0.5 percent to 41,510.33, a level it has
not closed below in nearly a month.
    Shares of telecommunications firm America Movil, controlled by billionaire
Carlos Slim, fell 0.43 percent, contributing most to the index's losses, while
those of lender Grupo Financiero Banorte lost 0.8 percent.
    Shares of Cemex, one of the world's top cement makers, fell 0.9
percent. The company said on Tuesday that it had raised about $1.1 billion by
selling a bigger-than-expected stake of its Latam unit in a Colombian initial
public offering. 
    Chile's IPSA index dropped 0.51 percent to 4,253.81 as shares of
electricity generator Endesa Chile and parent company Enersis 
fell 1.5 percent and 1.3 percent, respectively.
    Endesa Chile's third-quarter net profit plummeted 44.2 percent from the
year-earlier period on lower sales prices and higher costs, the company said on
    Latin America's key stock indexes at 1449 GMT:
 Stock indexes                         Daily pct    YTD pct
                          Latest          change     change
 MSCI Latam                  3,661.08      -1.37       3.05
 Brazil Bovespa             58,694.06      -1.29       3.42
 Mexico IPC                 41,510.33       -0.5      11.96
 Chile IPSA                  4,253.81      -0.51       1.83
 Chile IGPA                 20,872.70      -0.38       3.69
 Argentina MerVal            2,378.52      -0.68      -3.42
 Colombia IGBC              14,240.34      -0.62      12.43
 Peru IGRA                  20,932.73      -0.01       7.49
 Venezuela IBC             359,641.09       1.13     207.29

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