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Mexico, Brazil edge up
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December 16, 1999: 7:16 p.m. ET
Toronto stocks close in positive territory; IPC and Bovespa remain bullish
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NEW YORK (CNNfn) - Mexico's IPC index of leading shares ended at 6,859.03 points Thursday, a new record close, powered by telecom, media and retail issues that have recently disclosed plans to make debut, or expand operations, in the Internet field, traders said.
In Brazil, stocks ended firmer as investors, slightly short of funds after recent rallies, shopped for high-performing second-tier companies, traders said.
Toronto's benchmark stock index was up more than 50 points at midday after hitting a record high of 8,074.49 in morning trading.
Mexico closes at record high
Mexican stocks jumped to a new record in peso terms on Thursday on continued investor optimism about the country's economic outlook.
The IPC index of leading shares ended up 1.3 percent, or 86.88 points, at 6,859.03 points, breaking a record set last Friday. Volume was 124.6 million shares, and worth 2.18 billion pesos.
The market has soared throughout the year even as the peso has been stable against the dollar. At the end of 1998, the IPC stood at 3,959.66.
Despite the steady climb, in dollar terms the market still has not fully recovered from the disastrous peso devaluation of 1994 that created havoc throughout the Mexican economy. It is still about 10 percent below the level of August 1994, when the peso traded at about 3.40 to the dollar and the IPC was at about 2,760.
"I think the optimism is based on reality," said Gerardo Copca, an equities analyst at the Valores Finamex brokerage. Copca cited better than expected macroeconomic results in areas such as current account, growth and inflation.
The leading gainer Thursday was computer distributor and Internet concern Dataflux, which on Wednesday announced the sale of a 50 percent stake in its Todito.com Internet portal to broadcaster TV Azteca. Dataflux B shares arose 21 percent or 77 centavos to 4.42.
Market bellwether Telmex L shares rose 2.1 percent or 1.05 to 50.60. And the ADR of Telmex(TMX) inched up 2-7/16 to close at 108-7/16 on Wall Street trading.
Advancers beat decliners 57-30 and 16 issues were unchanged.
Mexico's peso closed fractionally weaker Thursday on thin volume and in the absence of market moving news. In Mexico City on 48-hour spot dollar markets, banking leader Banamex quoted the peso closing at a mid-rate of 9.358 per dollar, stronger from its open of 9.36 per dollar but weaker from Wednesday's close of 9.355.
Closing spreads were between 9.353 and 9.363.
Brazilian market inches up
Brazil’s Sao Paulo Stock Exchange's leading share index Bovespa finished up 1.22 percent at 14,497 points, well short of its record high of 14,812 reached on Monday.
Turnover was a hefty 1.02 billion reals ($555 million) compared with November's daily average of 778 million reals.
"The market is basically strong but there seems to be a lack of funds and some people are turning around to eke out profits," said Carlos Augusto Levorin, director at Oryx Asset Management in Sao Paulo. The Bovespa on Thursday ended well below its day's high of 14,681 points on profit taking.
With option contracts on individual shares expiring next Monday, investors were also adjusting their positions in the market's bellwether issue Telebras, which accounts for a large amount of volume on the bolsa. It slipped 0.6 percent to 196 reals and dragged the index lower.
Among the market's outperformers Thursday were banks Banespa, Itau, Bradesco and Unibanco, which rose on growth prospective. Banespa rose 7.4 percent to 61 reals while Unibanco rose 7.7 percent.
Steelmaker Acesita shot up 11.5 percent to 0.97 reals on speculation there could be a restructuring in its shareholder composition. Company officials were not immediately available for comment.
Regional aircraft manufacturer Embraer rose 7 percent to 5.67 reals on news that it received an order worth $200 million from China's Sichuan Airlines. Its common stock was also cited as a candidate to enter the Bovespa index beginning January.
Electrical appliance makers Multibras and Brasmotor, both local affiliates of Whirlpool Corp.(WHR), rose 22.5 percent and 19.8 percent respectively as they resumed trading following a five-day suspension.
Whirlpool on Wednesday raised its offer to buy back shares in the Brazilian companies to prices that represent a premium of 26.6 percent for Brasmotor and 28.2 percent for Multibras.
Klabin, the biggest pulp and paper firm in Latin America, rose 4 percent to 1.49 reals after it announced a joint venture with Norway's Norske Skogindustrier to form a joint venture to produce newsprint.
The Brazilian real continued its bull run against the dollar, firming another 0.6 percent on Thursday. The real closed at 1.837 per dollar, its strongest point since early August, compare with 1.848 at Wednesday’s close.
Elsewhere in Latin America
Argentine shares ended higher Thursday helped by investors moving into telecommunications stocks and out of banks. Traders said the market had reacted favorably to a deal the country's two largest telecommunications companies had struck with the government to reduce some tariffs which will probably only cut their revenues by less than 1.0 percent. The MerVal index of most-traded stocks ended up 0.97 percent at 541.94 points, pushed along by Telecom Argentina, which rose 3.33 percent, and Telefonica, up 2.08 percent.
Chile’s IPSA index of the leading 40 companies gained 0.29 percent to end at 137.17 points, and the broader IGPA gauge advanced 0.30 percent to 5014.84. Fifty-two stocks rose, 19 fell and 34 ended unchanged. Turnover was high at $28 million.
Venezuela’s foreign currency market and main stock exchange were closed Thursday as the country’s capital Caracas was hit by torrential rains that prevented most people from getting to work.
Toronto stocks end higher
Toronto's benchmark TSE 300 Composite Index was up 56.14 points, or 0.7 percent, at 8,041.43 on volume of 62.5 million shares worth C$1.08 billion. Advancers topped decliners 520 to 459 with another 280 issues unchanged.
The blue-chip S&P/TSE 60 index gained 3.40 points, or 0.6 percent, to 479.82.
In New York, the Dow Jones industrial average was off 86 points, or 0.77 percent, at 11,139. Nasdaq was up 46.67 points, or 1.29 percent, at 3,668.62, surpassing Monday's record close of 3,658.67 after climbing through 3,700 points for the first time ever in early morning.
A continued interest in high-technology issues propped up the Toronto index in early trading. The industrial products group was up 1.59 percent, with the utilities group close behind with a 1.44-percent hike. The lighter weighted pipelines sector was up 2.47 percent.
Nortel Networks Corp.(NT), the market's most substantial stock with a 13.5-percent weighting, was up C$3.35 to C$134.35.
Nortel's largest shareholder, Canadian telephone giant BCE Inc., gained C$1.95 to C$1178.85 after brokerage Goldman Sachs boosted the company to its recommend list from market outperformer.
"BCE and Nortel continue to be the real leaders in our market and as long as they keep going up I guess the Canadian market will keep going with it," one trader said.
"We're also seeing some bounce back in some of these tech stocks that have been hurt in the last couple of days...other than that it looks like it's a pretty general across the board rise," he said.
Fiber-optic equipment maker JDS Uniphase Corp. was leading net gainers, up C$19.00 to C$359.00, after it said on Thursday it will invest $125 million to expand its global operations.
These issues combine to make up about 25 percent of the overall market.
All but three of the TSE 300's 14 sub-indexes opened higher. The groups bucking the positive trend were communications, off 1.41 percent, metals and mineral, down 1.3 percent, and financial services, which slid 0.25 percent. 
- from staff and wire reports
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