Friday, June 2, 2006, 4:45 PM EST (Thomson Financial): Latin American
stocks climbed, as weaker-than-expected U.S. jobs data fueled hopes that
the U.S. Federal Reserve will pause its monetary tightening cycle.
Brazil's Bovespa Index rose 193.88 points, or 0.51%. Mexico's benchmark
Bolsa index jumped 293.10 points, or 1.53%, while Argentina's Merval index
added 10.74 points, or 0.64%
Brazilian stocks advanced, building on gains of 3% in the previous
session, as a smaller-than-expected rise in U.S. non-farm payrolls in May
eased concerns that the Federal Reserve will continue its tightening cycle
longer than expected to combat inflationary pressure.
A poll published today by a business magazine showed Brazilian
President Luiz Inacio Lula da Silva leading in his bid for a second
four-year term by a wide margin. If elections were held today, Lula would
win 49% of the vote against only 23% for the nearest contender, Geraldo
Alckmin of the Social Democratic Party, according to the poll. It was
conducted by the Vox Populi polling organization and published by Carta
Capital. Late Thursday, another poll, published by the Ibope institute,
showed Lula ahead of Alckmin by a margin of 43% to 19%. Brazilians go to
the polls in October to choose a president, state governors and members of
congress.
Elsewhere, Mexico's IPC stock index rose after losing more than 900
points, or 4.6%, during the first three days of the week, as investors sold
off emerging-market assets amid fears of rising U.S. interest rates.
Most major issues gained today, led by market heavyweight America
Movil. Fixed-line phone company Telmex also ended the session higher, as
did cement giant Cemex; bank Banorte rose as well.
A major investment bank reinstated coverage of Banorte on Thursday with
a "buy" rating based on valuation. The investment bank said Banorte's
shares are attractively valued, trading at an estimated 2006 price to book
value of two times, which is lower than the levels posted at year-end 2004
and 2005.
Argentine issues saw another day of mild gains, although volumes were
very thin amid a dearth of local market news.
-- Michael.O'Brien@contractor.Thomson.com
This is Thomson Financial Corporate Services Latin American Commentary.
The information herein is believed to be true and accurate, we take no
responsibility for inaccurate information and reserve the right to update
our reports. If you have any questions please e-mail James Sang at
james.sang@tfn.com or call 646.822.6233. For more information about Thomson
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SOURCE Thomson Financial
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