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Mexico stocks up as U.S. turns in better-than-expected data
By Carla Mozee, MarketWatch
Last Update: 3:54 PM ET Nov 25, 2009
LOS ANGELES (MarketWatch) -- Mexican stocks rose Wednesday, buoyed by data indicating that the United States, its biggest export market, remains on the path toward recovery.
Mexican stocks rose 0.6% to 31,195, with market heavyweight America Movil AMX up by 2% and a nearly 3% rise in industrial and manufacturing stocks.
Industrial and retail conglomerate Grupo Carso GPOVY rose 1.8%, auto parts maker Alfa gained 2.7% and steel producer Grupo Simec SIM rose 3.2%. The IPC equity index's best price performer was Minera Autlan, as shares of the manganese producer rose 4.6%.
But gains were held in check by a decline in transportation and consumer-staples stocks.
Stocks found support following reports from the U.S. that sales of new homes rose 6.2% in October, weekly first-time jobless claims fell below the 500,000 level for the first time since last year, and spending by consumers rebounded last month.
"The broad [spending] gains suggest personal consumption is picking up modestly even without direct support from temporary government stimulus programs," wrote economist Sal Guatieri at BMO Capital Markets in a note Wednesday.
The consumer spending data arrived just before the start of the holiday-shopping season. Consumer spending drives about 70% of the U.S. economy. Upbeat economic news from the U.S. is favorable for Mexico because it sends about 80% of its products to the country.
But not all of Wednesday's economic news was positive. U.S. durable-goods orders unexpectedly fell 0.6% in October.
Mexico's currency strengthened on Wednesday, with greenback purchasing 12.845 pesos compared with 12.8975 pesos on Tuesday.
Among exchange-traded shares, the CurrencyShares Mexican Peso Trust FXM rose 0.5% and the iShares MSCI Mexico Index Fund EWW gained 1.4%.
Investors on Friday will receive the Bank of Mexico's decision on its key interest rate. Analysts widely expect policymakers to hold the rate at 4.5%.
Brazil's Bovespa rose 0.9%, Argentina's Merval rose 0.2% but Chile's IPSA lost less than 1 point to 3,250.
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