NEW YORK (CNN/Money) - Brazilian stocks finished lower on Friday, closing a roller coaster week during which market worries over inflation and the outlook for presidential elections weighed on investors' outlook.

But Mexican stocks ended higher led by shares of industrial conglomerate Alfa as cyclical issues gained on economic recovery hopes, but the market was held back by losses in shares of bellwether Telmex.

Toronto stocks capped off a losing week with their fifth straight decline, led by technology and bank issues, amid a busy schedule of earnings reports that many said lacked optimistic guidance.

The Sao Paulo Stock Exchange's Bovespa fell 1.49 percent to end the week at 13,075.5 points, leaving it down 3 percent on the week and 3.7 lower in the year-to-date.

Market heavyweight Telemar helped pull the Bovespa lower, sliding 3.86 percent to 30.60 reals, as investors took profits from gains in recent days and prepared for its earnings report after the market close. Telemar accounts for about 11 percent of the index.

Traders said signs the Central Bank was being more cautious about inflation had soured the mood by probably ruling out future interest rate cuts for the time being. Moreover, investors are worried that the government's favored candidate for elections, Jose Serra, who is also the market's favorite, is not gaining much ground in opinion polls.

Traders said they were nonetheless cheered by the first drop in Brazil's unemployment rate for eight months in March, and that had helped check some of the losses.

State oil company Petrobras, which also accounts for 11 percent of the Bovespa, fell 2.11 percent. It suffered in the previous session on fears a slimmer budget surplus on Thursday pointed to weaker first quarter results in state companies.

Beleaguered long-distance phone operator Embratel fell 2.44 percent after its parent U.S. company WorldCom (WCOM: Research, Estimates) said it would consider selling the loss-making unit.

Traders are wary of the stock, which stands 36 percent weaker than where it began the year, due to Embratel's weak results. It posted its fifth straight quarterly loss on Monday after losing more than half a billion dollars in 2001 due to its overseas debts and nonpayment of bills.

No. 1 private bank Bradesco rose 0.71 percent while its closest rival Itau closed steady after both qualified to bid for the privatization auction of northeastern Maranhao state bank on June 10. The auction base price is 78.2 million reals ($34 million).

Brazil's currency, the real, weakened to 2.372 per dollar from Thursday's close of 2.358 in thin trade.

Mexico's benchmark IPC index of 35 leading stocks rose 0.2 percent to close at 7,491.78 points, notching a modest loss for the week of 0.23 percent. The index remains up nearly 15 percent since the start of the year.

Shares of Grupo Alfa, a major industrial conglomerate that, among other activities, supplies auto parts to U.S. car makers, rose 6.46 percent to close at 18.30 pesos per share.

"In Mexico, we maintain a strategy favoring cyclicals like cement as well as beverages and retail," said Robert Berges, senior Latin American strategist at Merrill Lynch.

Shares of Mexican cement titan Cemex, rose 2.06 percent to close at 58.20 pesos per share.

Shares of Mexican brewer and bottler FEMSA rose 2.40 percent to end at 46 pesos per share after positive analyst comments.

In the currency market, the peso closed with a modest gain of 0.90 centavo from Thursday at 9.3310 per U.S. dollar.

The Toronto Stock Exchange 300 composite index closed down 56.67 points, or 0.74 percent, at 7,629.62, marking its lowest close in two months. On the week, the TSE shed 2.4 percent.

Market momentum on Friday was negative as declining issues eclipsed advancers 589 to 517 on a modest volume of 187.7 million shares worth C$2.4 billion.

Nine of the TSE 300's 14 subindexes closed lower, led by a 2.6 percent slide in the tech-heavy industrial products sector and a 1 percent fall in financial issues.

Dreary forecasts from companies like telecom equipment maker JDS Uniphase Corp. intensified fears of a tepid recovery in corporate profits.

Shares of JDS closed down 85 Canadian cents, or 9 percent, at C$8.50 after the company posted a third-quarter net loss of $4.3 billion, cut another 2,000 jobs and said it expects a wider fourth-quarter loss than anticipated.

Although not part of the key TSE 300 composite index, JDS often influences broader tech sentiment.

Nortel Networks (NT: Research, Estimates) stock closed down 34 Canadian cents at C$5.46, electronic manufacturer Celestica Inc. dropped C$1.75 to C$44.05, while wireless company Research In Motion fell 90 Canadian cents to C$28.25.

In Toronto, the blue-chip S&P/TSE 60 index slipped 4.46 points, or 1.02 percent, to 430.79.

"The problem here is a lack of confidence in the system, and the market really needs to get some issues straightened out," said Sal Masionis, a broker with Brant Securities Ltd.

"Overall, I think the earnings came in better than expected but some lacked guidance because the major companies don't even know what's coming."