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Americas miss Dow bounce
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July 27, 1998: 5:35 p.m. ET
Canada, Mexico, Brazil slump from open while Caracas falls sharply
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NEW YORK (CNNfn) - After spending the morning following Japanese stocks and Wall Street lower, most major markets in the Western Hemisphere recovered their balance only one step behind an eleventh-hour Dow rebound, ending the day only slightly weaker.
Toronto stocks fell on concern that Japanese financial reforms would not go far or fast enough to rescue that nation's economy, while concern over a sluggish start on Wall Street also contributed to a bearish atmosphere.
The Toronto Stock Exchange 300 Composite Index fell 29.96 points, 0.42 percent, to 7,140.62.
In New York, the Dow Jones industrial average plunged as low as 8,860 points -- down 76 -- before righting itself to end up 90.62 points at 9,027.98.
Dragging the market down was a poor overnight performance by Japan's Nikkei Index, which fell 417.53 points or 2.55 percent to 15,944.36.
"There is concern about the Japanese market that they're not going to make the tough decisions that they should," said Irwin Michael, portfolio manager at ABC Funds in Toronto.
Hit hard by the Asian concerns are the commodities stocks -- particularly gold and metals -- as the demand for the metals diminishes in the Asian countries.
The gold sector fell 0.37 percent while the metals and minerals group gained a scant 0.28 percent near the session's end. The August price for Comex gold was down US$0.70 to US$290.50 an ounce.
Concern over the slumping Canadian dollar hurt the market as well. The Canadian dollar continued its downward spiral, dropping past C$1.50 for the first time in history overnight.
Mexican stocks closed lower in response to overnight slides on Asian markets, but shares recovered much of their earlier losses due to a rebound on Wall Street, dealers said.
"The Dow (Jones) turned around and that helped the bourse to halt its slide and moderate losses," a desk trader said.
The 35-stock IPC share index closed down 22.06 points, 0.49 percent, at 4,473.04, having dipped as low as 4,415.08. Volume was thin at 67.3 million shares
Analysts said the Mexican bourse failed to mimic Wall Street's late gains because emerging markets were more susceptible to fallout from Asian markets, which slid on disappointment over Japan's new prime minister.
"We're seeing a market linked to an unfavorable backdrop," said Hugo Morales, research head at the Valburmex brokerage.
Morales said retailer Grupo Elektra (EKT) weighed on the market after posting disappointing second-quarter earnings earlier in the day.
Elektra was near the top of the prominent losers list, ending down 0.60 peso, 6.82 percent, at 8.20 pesos. The stock accounted for almost half of all shares traded.
Bellwether stock Telefonos de Mexico (Telmex) (TMX) reversed an early slide, gaining 0.20 peso to 22.75.
Brazilian stocks ended slightly lower, paring losses late in the session alongside a rebound on Wall Street and ahead of the huge Telebras privatization scheduled for Wednesday, dealers said.
"The local market improved with the recovery of Dow Jones in New York in the afternoon," a trader at a local brokerage said.
The Sao Paulo Bovespa index of the 58 most active stocks closed little changed, edging 11 points, 0.1 percent, lower at 10,564. At its lowest point, the Bovespa was down 2.5 percent.
A recovery by Telebras preferred, which ended up 0.67 percent at 135.8 reals, helped the index in late trading.
The Brazilian government is slated to sell on Wednesday 12 holding companies spun off from Telebras, but it faces the threat of legal challenges that may delay it. The government expects to rake in about 16 billion reals with the sale described as Latin America's largest ever.
The Venezuelan bolsa resumed trading after a long Simon Bolivar Day weekend with a sharp loss.
The Caracas IBC index ended down 116.02 points, 2.35 percent, at 4,822.66. 
-- from staff and wire reports
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