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Mexican stocks cautious at midday awaiting GDP
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Mexican stocks lost some of their morning gains in midday trade Thursday as the market showed caution ahead of Mexico's second quarter gross domestic product (GDP) figures, due out at 2.30 p.m local time (1930 GMT).
Mexico's benchmark IPC .MXX index of the 38 most liquid shares was up 0.4 percent at 6,077.25 points, having opened the day up 1.07 percent.
"Good GDP news will obviously be good for confidence and for the market. But growth in the U.S economy remains the No. 1 variable affecting Mexico," said Francisco Rivero, head of research at Santander Central Hispano in Mexico City.
GDP is expected to rise for the first time in three quarters, analysts say, with many hoping the figure will mark an end to Mexico's recession.
Economists surveyed by the Central Bank see Mexican second-quarter GDP rising by 1.43 percent, while the Finance Ministry predicts growth of 2 percent. GDP fell 2 percent in the first three months of 2002.
In the currency market, the 48-hour peso MEX01 showed a slight gain at midday, gaining 0.3 percent on the U.S dollar to trade at 9.95. The peso opened the morning session up 0.54 percent at 9.93 pesos to the dollar.
The peso has been knocked about by uncertainties over the outcome of Brazil's October elections, falling through the psychological barrier of 10 to the dollar twice so far this week in intraday trade.
Investors fear a leftist president in Brazil would end eight years of pro-market reforms and mismanage Brazil's $250 billion debt, sparking a crisis of confidence that could spread throughout Latin America -- including Mexico.
In local market action, continued speculation of a takeover of local banking group Bital GFBITALO.MX by global bank HSBC Holdings HSBA.L lifted Bital's shares by 8.77 percent to 9.3 pesos a share in midday trade. Bital's shares have climbed 18 percent since Aug. 9.
Shares in Iusacell CELV.MX , Mexico's second largest wireless operator which has seen heavy losses in recent months, rose 4.9 percent to 0.9 peso.
Shares in TV Azteca TZA.N , Mexico's No. 2 broadcaster, climbed 5.22 percent to 3.83 pesos. Earlier this week Moody's Investors Service debt rating agency raised its ratings on Azteca's debt.
Shares in Mexican glass maker Vitro VTO.N saw the biggest drop in the midday session, falling 5.10 percent to 9.3 pesos. Vitro reported weak second quarter earnings in July, hit by slow sales amid Mexico's economic recession.
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August 21st, 2002
Source: Reuters |
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