April 19, 2010 / 5:04 PM / 9 years ago

Mexico peso slips, stocks fall to 3-week low

* Peso slides up to 0.38 pct, IPC stock index down 1.22 pct

* Goldman, Greece jitters weigh on risky assets (Recasts; updates prices, adds background)

MEXICO CITY, April 19 (Reuters) - Mexico’s peso slipped to its lowest in over two weeks on Monday and stocks fell to their lowest in three weeks as fraud charges against Goldman Sachs and concerns about the Greek debt crisis weighed on higher-risk emerging market assets.

The peso MXN= MEX01 slipped to as weak as 12.3608 per U.S. dollar, its weakest since April 1, before pulling back to trade at 12.328 per dollar, or 0.38 percent weaker.

The IPC stock index .MXX lost as much as 1.22 percent to hit 33,212 points, its lowest since March 29. They last traded down 0.86 percent at 33,333.24 points.

Investors were still cautious following charges of fraud on Friday from the U.S. Securities and Exchange Commission against Goldman Sachs Group Inc (GS.N) in connection with a debt product tied to subprime mortgages. For full story, see [ID:nN16121493]

The charges have stirred expectations of suits against other major banks and could bolster the case for financial reform under debate in Washington.

“Right now, everything is with caution. We are still very close to the shock from Friday, and I do not think there is much appetite for risk at the moment,” said Ramon Cordova, a trader at brokerage BASE in Monterrey.

The fraud charges hit riskier assets around the world as investors sought safe-haven investments, like U.S. bonds. Mexico’s peso and IPC fell by the most in more than two months on Friday.

Investors are also worried about how a European Union- International Monetary Fund aid plan to help Greece avoid a debt default might be implemented after a meeting was delayed due to the volcanic cloud disrupting flights across Europe.

Concerns of a debt default in Europe have hit riskier assets like stocks and emerging market currencies in recent months, as a deeper financial crisis in Europe could spur a steeper sell-off in risky assets.

Optimism about recovery in the two closely linked economies of the United States and Mexico has helped the peso gain around 7 percent this year while the IPC has been consistently setting record highs since March.

Traders said they doubted that recent weakness due to global jitters will spur much steeper losses for Mexican assets.

“This correction will turn into a buying opportunity,” said Gerardo Roman, head of stock trading at Actinver brokerage in Mexico City.

In stock trading, shares in miner Grupo Mexico (GMEXICOB.MX) lost 2.2 percent to 34.68 pesos while America Movil (AMXL.MX), Latin America’s biggest cell phone operator dipped 1.67 percent to 31.15 pesos.

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