Mexico stocks up on America Movil gains; peso firms

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MEXICO CITY, Feb 18 (Reuters) - Mexico's stocks closed sharply higher on Monday, led by rises in cell phone operator America Movil, while the peso strengthened.

The benchmark IPC stock index .MXX added 1.49 percent to 29,172.21 points in light trade as U.S. markets remained closed for the Presidents Day holiday.

Shares of America Movil (AMXL.MX: Quote, Profile, Research), Latin America's leading mobile telephone firm, climbed 1.72 percent to 33.08 pesos.

The peso MEX01 <MXN=>, which has been trading recently at three-month highs, strengthened 0.22 percent to 10.7345 per dollar after the central bank held interest rates steady at its monthly review on Friday, as expected.

Many economists see rate cuts later this year to protect the Mexican economy from a slowdown in the United States.

"We think the earliest the bank would cut the overnight rate is 16 May, 2008, inflation data permitting," Credit Suisse said in a report.

Mexico's benchmark 10-year government peso bond <MX10YT=RR> was up 0.069 of a point in price to bid 101.73, pushing its yield down 1 basis point to 7.50 percent.

Grupo Mexico (GMEXICOB.MX: Quote, Profile, Research), one of the world's largest copper miners, added 3.32 percent to 67.46 pesos.