By Carla Mozee
Latin American equity markets rose Friday, with sugar producer
Cosan Ltd. leading advancers in Sao Paulo and helping the country's
benchmark move toward its longest weekly winning streak in nearly a
year.
Brazil's Bovepsa rose 0.6% to 43,982.92, with shares of Cosan
(CZZ) jumping 16%.
The market "has yet to realize" the positive impact that higher
sugar prices and a weaker local currency will have on the sugar
producer's cash generation, said Citigroup analyst Tereza Mello in
a note to clients Friday.
The broker also said it's recognizing the integration advantages
that come with Cosan's purchase of a fuel distribution chain in
light of volatile ethanol prices at the mill.
The Bovespa's gains were limited, however, as shares of oil
giant Petrobras (PBR) slipped 0.2%.
With this week's advance of about 5%, the Bovespa will mark its
longest weekly winning streak since mid-April through mid-May of
2008.
Mexico's IPC rose 0.1% to 2,021.87, with gains capped in part by
a 1.7% loss in shares of Cemex (CX).
The market eased back from stronger advances that followed an
announcement by the Mexican central bank that it will use a $30
billion swap facility with the U.S. Federal Reserve. It plans on
April 21 to auction $4 billion from the swap line.
Mexico's currency was recently up about 2% at 13.548 pesos per
U.S. dollar.
Equities in Brazil and Mexico are both on track to log four
straight sessions of wins.
Argentina's Merval is also ready to post four weeks of gains,
the first time it's accomplished that since May 2008.
Brazilian and Mexican markets were among those that surged
Thursday, in part after leaders of the Group of 20 nations pledged
$1.1 trillion to the International Monetary Fund and other
institutions in a move to boost lending and jumpstart economic
activity worldwide.
The meetings "are welcome for a world eager to see "something,"
said Dalton Gardiman, chief economist at Banco Bradesco BBI, in a
note Friday. "Nevertheless, we are concerned that for the markets,
an expansive and very optimistic view with respect to the capacity
of these gatherings to do something is very limited, and should be
taken with a large grain of salt."
On Friday, the Merval rose 4.5%, playing catch up as the market
was closed Thursday for a holiday. Shares of steel tube maker
Tenaris SA (TS) up 6.4%. The Luxembourg-based company's weighing on
the Merval was raised this week to 46%, up from 35% in the first
quarter, as part of the benchmark's new lineup.
Off the Bovespa index, shares of MMX Mineracao e Metalicos SA
were among the most actively traded in Sao Paulo. They leaped 14%
and are one their way to posting a more than 50% jump for the
week.
In its daily securities update, Itaú Securities on Friday
reinitiated coverage of the miner with an outperform rating, and
said it viewed BHP Billiton Ltd. (BHP) and Chinese steelmakers "as
potentially interested players" in purchasing MMX.
Earlier this week, MMX's board cleared the way for the company
to hire a financial adviser as it seeks to sell all or a portion of
its assets. MMX is run by billionaire Eike Batista.
In Mexico City, shares of Grupo Mexico led advancers with a jump
of 9.7%. The copper miner said it will appeal a U.S. federal court
ruling that prompted investors to send its shares plunging 15% on
Thursday.
A federal court in Texas ruled that Grupo Mexico must compensate
Asarco LLC for the 2003 fraudulent transfer of shares in Southern
Copper Corp. (PCU) that had been held by Asarco. Asarco was
purchased by Grupo Mexico in 1999, but lost operational control in
the wake of Asarco's bankruptcy.