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EMERGING MARKETS-Brazil stocks choppy on earnings, economic data
February 20, 2013 / 4:35 PM / in 5 years

EMERGING MARKETS-Brazil stocks choppy on earnings, economic data

* Brazil economic activity data disappoints in December
    * Pao de Acucar earnings beat forecasts on cost-cutting
    * Brazil Bovespa falls 0.23 pct, Mexico IPC drops 0.42 pct

    By Asher Levine and Danielle Assalve
    SAO PAULO, Feb 20 (Reuters) - Brazilian stocks were choppy
on Wednesday as investors focused on a slate of fourth-quarter
earnings results and weaker-than-expected economic activity
data.
    Brazil's benchmark Bovespa stock index slipped for a
sixth straight day, losing 0.23 percent to 57,180.58 after
spending part of the morning in positive territory.
    Shares opened lower after December economic activity data
came in weaker than expected early on Wednesday, adding to
concerns over lackluster growth in Latin America's largest
economy. 
    "The numbers didn't help. Economic activity is quite weak
and the worries continue, with inflation a concern," said
Clodoir Vieira, chief economist with Souza Barros in Sao Paulo. 
    Investors also focused their attention on corporate
earnings, with shares of retailer Grupo Pão de Açúcar 
rising 2.25 percent after touching an all-time high on
better-than-expected earnings posted on Wednesday.
 
    Units of BTG Pactual Group rose 1.5 percent
after fourth-quarter profit at Latin America's largest
investment bank beat analysts' estimates. 
    Exchange operator BM&FBovespa SA fell 2 percent
after Brazil's sole financial bourse reported lower
fourth-quarter net income. 
    Brazil's Bovespa has been struggling to keep up with its
regional peers and other equity markets, having lost over 5.5
percent in 2013.
    Increasing fears over inflation have recently led investors
to step up bets on interest rate hikes this year, which could
put even more downward pressure on local stocks.
    "We are seeing some of the country's major pension funds
leaving the equities market, despite rates being at record-low
levels," said Anderson Luz, managing partner with Intrader in
Sao Paulo.
    Pension funds and other large institutional investors tend
to place more of their assets in bonds, as opposed to riskier
equities, when interest rates rise.
    Luz said that while an upcoming rate hike is not a
certainty, it could set a precedent for more increases ahead,
which could lead to further troubles for the Bovespa.
    Mexico's IPC index returned part of the previous
session's gains, losing 0.42 percent to 44,451.69.
    Telecommunications firm America Movil, controlled
by billionaire Carlos Slim, lost 2 percent and contributed most
to the index's losses, while mining company Grupo Mexico
 fell 1 percent.
    Chile's IPSA index posted its biggest drop in four
months, losing 0.97 percent to 4,559.99.
    Shares of regional energy group Enersis fell nearly
4 percent, contributing most to the index's losses. Traders said
shares suffered from profit-taking after a deadline for an
upcoming capital increase, which had increased demand for the
stock in the previous session.
   
    Latin America's key stock indexes at 1615 GMT:
    
 Stock indexes                            daily %     YTD %
                                Latest     change    change
 MSCI LatAm                    3,859.20     -0.72      2.36
                                                   
 Brazil Bovespa               57,180.58     -0.23     -6.19
                                                   
 Mexico IPC                   44,451.69     -0.42      1.71
                                                   
 Chile IPSA                    4,559.99     -0.97      6.01
                                                   
 Chile IGPA                   22,211.27      -0.8      5.42
                                                   
 Argentina MerVal              3,268.77      0.14     14.52
                                                   
 Colombia IGBC                14,821.20     -0.37      0.72
                                                   
 Peru IGRA                    20,802.28     -1.07      0.84
                                                   
 Venezuela IBC               615,343.63      0.68     30.53

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