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EMERGING MARKETS-Latin American stocks dip on Europe tensions
September 26, 2012 / 10:07 PM / 5 years ago

EMERGING MARKETS-Latin American stocks dip on Europe tensions

* Spanish protests, Greek strike undermine bailout hopes
    * Brazil's Bovespa off 0.04 pct, Mexico's IPC up 0.29 pct
    * Santander Mexico offering highlights Latam appetite

    By Danielle Assalve
    SAO PAULO, Sept 26 (Reuters) - Latin American stocks dipped
for the second straight day on Wednesday after violent protests
in Spain and a strike in Greece renewed concerns that the euro
zone's debt crisis could derail a weak global economy.
    The MSCI Latin American stock index lost
0.45 percent. The index has given up most of its gains since the
U.S. Federal Reserve announced another round of stimulus two
weeks ago, driving the index to its highest since May.
    Violent clashes in the streets of Madrid and a general
strike in Greece stoked doubts about European leaders'
commitment to economic reform. 
    New signs of tensions among top euro zone officials also
underscored the long road ahead as Europe struggles with its
debt woes.  
    In Latin America, investors booked profits from a recent
rally, betting that bad news out of Europe would hurt the
prospects for higher-risk emerging market assets.
    "The bourse is dependent on the news from Europe, where
things have worsened in recent days, especially in Spain," said
economist Gustavo Mendonca at Saga Capital in Rio de Janeiro.
"The index should continue to be a hostage to external
    Brazil's benchmark Bovespa stock index edged down
0.04 percent.
    Some of the hardest hit Brazilian shares on Wednesday were
focused among retailers giving back gains after an index of
Brazil's consumer stocks rose 26 percent this year.
    Apparel retailer Lojas Renner shed 4.7 percent
and online vendor B2W lost 4.32 percent.
    Homebuilder Gafisa bounced back from early losses
to rise 2.84 percent.
    The Bovespa's upward trend remains intact as long as it
stays above 58,900 points, according to Ivo Moreira of the
Banrisul brokerage in Porto Alegre.
    Stocks ability to recover from early losses reinforced a
Reuters poll released on Wednesday that showed the index
extending a rally into next year. 
    Mexico's IPC index shook off early losses to rise
0.29 percent as shares of billionaire Carlos Slim's
telecommunication firm America Movil fell to a
five-month low. But it bounced back up from a support level at
16 pesos per share to close 1.29 percent higher.
    Shares of the Mexican unit of Spanish bank Santander jumped
in its market debut following the country's biggest share
offering ever.
    Santander Mexico, not yet on the IPC, gained
6.9 percent from its price in a public offering on Tuesday. Its
parent company, Spain's biggest bank, raised more than $4
billion in a much-awaited share sale highlighting strong
investor appetite for assets in Latin America's second-largest
    The share offering was 4.8 times oversubscribed, but the
bank has no plans to reopen or extend it, Santander CEO Marcos
Martinez said in a Wednesday interview. 
    Mexican stocks are seen advancing another 7 percent in a
Reuters poll to a record high after recent pledges of monetary
stimulus from major central banks. But strategists remain wary
of high valuations and slowing global growth. 
    In Chile, the blue-chip IPSA index traded flat as a
1.12 percent gain in industrial conglomerate in Copec 
was offset by a 1.56 percent loss in shares of Chilean
fertilizer, lithium and iodine producer Soquimich (SQM)
    Latin America's key stock indexes at 2130 GMT:
 MSCI LatAm                 3,683.04     -0.45      2.24
 Brazil Bovespa            60,478.05     -0.04      6.56
 Mexico IPC                40,332.98      0.29      8.78
 Chile IPSA                 4,200.48      0.03      0.55
 Chile IGPA                20,431.22     -0.02      1.50
 Argentina MerVal           2,461.01     -2.85     -0.07
 Colombia IGBC             13,868.84     -0.75      9.50
 Peru IGRA                 21,583.91     -0.75     10.84
 Venezuela IBC            304,393.41         0    160.08

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