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EMERGING MARKETS-Latam stocks up on Mantega comments, US data
March 1, 2012 / 11:12 PM / 6 years ago

EMERGING MARKETS-Latam stocks up on Mantega comments, US data

* Brazil’s Mantega denies reports of equities tax

* US jobs data supports Mexico’s IPC

* Brazil Bovespa gains 1.5 pct, Mexico IPC up 0.57 pct

By Rachel Uranga and Asher Levine

MEXICO CITY/SAO PAULO, March 1 (Reuters) - Latin American stocks touched a new seven-month high on Thursday after Brazil quashed reports the country would tax equities purchases by foreigners and encouraging U.S. jobs data stoked optimism an economic recovery was gaining steam.

The MSCI Latin American stock index rose 1.21 percent. Brazil’s benchmark Bovespa stock index advanced 1.52 percent to 66,809.80, its highest level in over 10 months.

Brazilian Finance Minister Guido Mantega denied reports the government would impose a tax on foreign purchases of Brazilian stocks.

Speculation over such measures had mounted after the government announced the extension of a tax on foreign loans and interventions in the foreign exchange market continued in an effort to stem the real’s appreciation.

“The stock market here rose precisely because the finance minister said he wouldn’t touch the market,” said Jose Francisco de Lima Goncalves, chief economist for Banco Fator in Sao Paulo. “What the minister said signaled that people can keep coming to the market and the exchange will continue rising.”

Further boosting markets, the European Central Bank’s second massive injection of cash eased fears of a meltdown in the banking sector and spurred global equity markets.

Shares of JBS, the world’s largest beef producer, jumped 10.14 percent after struggling U.S. subsidiary Pilgrim’s Pride Corp. said it raised $200 million in a rights offering.

Brazil’s state-controlled oil company Petrobras gained 2.34 percent and oil producer OGX, controlled by Brazil’s richest man Eike Batista, advanced 1 percent.

Shares of BM&FBovespa, the world’s third-largest exchange, were up 1.83 percent after Reuters reported the company is unlikely to share clearing, custody and settlement facilities with potential rivals until at least 2014.

Food company Marfrig rose 0.95 percent to a near seven-month high. Shares have been on an upward trend since the company said Monday it planned a reorganization that would save 330 million Brazilian reais ($193 million) over five years.

Mexico’s IPC index advanced 0.57 percent to end at 38,033.45 points as data showing new U.S. jobless claims edged down to a near four-year low, stoking optimism that an economic recovery in Mexico’s largest trading partner was gaining steam. The trend tempered a separate report showing weaker growth in U.S. manufacturing and consumer spending.

“In the last few days, the (U.S. macroeconomic data) has been mixed and that’s exactly why the index hasn’t been able to break through resistance levels with more force,” said Luis Rodriguez, an analyst at brokerage Finamex in Guadalajara. “The data turned investors off but not enough to see a fall.”

Mexico’s IPC has been trading in a narrow range and had failed to break past 38,300 points for more than a week.

Bottler Femsa rose 2.38 percent and group Banorte gained 3.73 percent.

Chile’s IPSA index touched a seven-month high, rising for a third straight session. It ended up 0.53 percent at 4,559.81 points.

Retailer Cencosud rose 0.58 percent after shareholders approved the issuing of shares in foreign markets to help finance growth. (Reporting by Rachel Uranga and Asher Levine; Editing by Gary Crosse)

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