Mexico stocks rise on GMAC aid; peso weakens

MEXICO CITY, Dec 30 (Reuters) - Mexican stocks rose on Tuesday after Washington expanded its bailout of the U.S. auto industry, which is closely tied to Mexico's economy, but the peso slipped after weak U.S. data boded poorly for exports.

The benchmark IPC stock index .MXX gained 0.23 percent to 22,244 points.

Late on Monday, the Bush administration said it was increasing a loan to troubled automaker General Motors GM.N by $1 billion and buying $5 billion in equity in GMAC, GM's finance arm.

It was the latest in a string of moves by the U.S. government in an effort to ease tight credit markets and cushion the impact of the year-long recession in the United States, Mexico's top trading partner.

"The IPC should benefit from the help for GMAC, since they operate in Mexico and, next to Ford Credit, are the biggest independent financier of the sector in our country," wrote Jaime Ascencio, an analyst at Actinver brokerage in Mexico City, in a note to clients.

While Mexico's banks were not exposed to the same mortgage related securities that crippled U.S financial firms, consumer credit has been shrinking, adding to worries about declining consumer spending and falling car sales.

The peso MXN=MEX01 slipped 0.76 percent to 13.725 per dollar after weak data on U.S. factory activity and consumer confidence.

A report showed business activity in the U.S. Midwest continued to shrink in December, although at a less severe rate than expected, while input prices fell sharply.

Mexico sends around 80 percent of its exports to the United States and many of the goods are parts for U.S. manufacturers.