Argentine Stock Index Rises on IMF Meeting: Latin Stocks
April 18 (Bloomberg) -- Argentina's Merval rose for the first day in seven on optimism the country can revive a $13.3 billion loan accord with the International Monetary Fund, after a meeting between officials of the government and the lender.
The Merval index rose 31.42, or 2.5 percent, to 1307.90 after falling 10.3 percent in the previous six days. Grupo Financiero Galicia SA, the country's biggest non-government bank, led the gain.
Argentine stocks rose after the meeting yesterday between IMF Managing Director Rodrigo De Rato and Economy Minister Roberto Lavagna in Washington. The IMF last year put on hold a $13.3 billion loan accord until the country completes the restructuring of about $104 billion of debt.
``The news of the meeting between the government and the IMF is a sign that both parties are a bit closer and they returned to the dialog,'' said Antonio Cejuela, an analyst with Puente Hermanos brokerage in Buenos Aires, with an investment portfolio of about 450 million pesos ($155 million) in assets. ``The markets needed a new driver to recover from the deep drop in the past week.''
De Rato told reporters after the meeting that Argentina has to develop a realistic strategy to deal with creditors who didn't participate in the offer. Argentina in February agreed with 76 percent of its bondholders to exchange $62.3 billion in defaulted debt leaving, $20 billion worth of defaulted debt in the hand of creditors who rejected the offer.
Economic Concern
Elsewhere in Latin America, the Bolsa index of the most- traded stocks on the Mexico City Stock Exchange fell a fourth day, dropping 202.71, or 1,7 percent, to 11,739.99. The index plunged 4.5 percent last week, its seventh straight weekly decline. The Bolsa's slump is its longest since September 1998, when it ended an eight-week slide.
The stocks fell on concern slowing growth in the U.S. will undermine the economy in Mexico, said Rodolfo Navarrete, who helps manage about $100 million in stocks with Vector Casa de Bolsa SA in Mexico City.
U.S. factory output fell 0.1 percent last month, the first decline since September, the Federal Reserve reported Friday. Consumer sentiment as measured by the University of Michigan fell this month to the lowest level since September 2003, according to another report Friday.
Brazil's benchmark stock index rose 221.19, or 0.9 percent, to 24,877.04. The main indexes in Venezuela and Colombia fell while Chie's index rose and Peru's was little changed. Morgan Stanley's index of Latin American stocks fell 0.4 percent to 1423.45.
The following stocks made significant gains or losses in Latin American markets today. Symbols are in parentheses after the company name. In Brazil, the preferred share is usually the company's most-traded class of stock.
Argentina
Galicia (GGAL AR) rose 4 centavos, or 1.9 percent, to 2.10 pesos, the first gain in eight days. Galicia fell 9.7 percent last week.
BBVA Banco Frances SA (FRAN AR), Argentina's third-largest bank by deposits, rose 23 centavos, or 4.1 percent, to 5.88 pesos. Frances and Galicia are among the national banks that the government hired as local advisers for the restructuring.
Mexico
Telefonos de Mexico SA (TELMEXL MM), Mexico's largest local and long-distance telephone company, fell for a fourth day, dropping 48 centavos, or 2.6 percent, to 18.32 pesos. Telmex yesterday paid about $235 million to buy shares in its Brazilian unit Embratel Participacoes SA. Embratel shareholders bought 831.1 million reais ($323 million) of new stock for 4.30 reais a share, or 46 percent of the total stock on offer. Telmex bought 73 percent of the offer.
America Movil (AMXL MM) fell 78 centavos, or 2.8 percent, to 26.99 pesos. The company, controlled by Mexican billionaire Carlos Slim, has fallen six of the last seven days and has lost 15 percent since rising to a record Feb. 25.
Brazil
Cia. Vale do Rio Doce (VALE5 BS), the world's largest iron- ore producer, rose 1.35 reais, or 2.4 percent, to 61.7 reais, after five days of declines. Investors including Rodrigo Carvalho, who helps manage about $230 million in stocks for BNP Paribas SA in Sao Paulo, say a 71 percent increase in the price of the company's ore, announced last month, will ensure it continues posting solid financial results.
Chile
Lan Airlines SA (LAN CC), Chile's biggest airline, rose 100 pesos, or 2.4 percent, to 4,300 pesos. The company acquired 49 percent stake in Aero 2000, an Argentine carrier, as part of its plan to expand its operations in South America. Lan Airlines' stock has risen 18.3 percent in the year.
To contact the reporters on this story:
Eliana Raszewski at
eraszewski@bloomberg.net