November 12, 2012 / 3:12 PM / 5 years ago

EMERGING MARKETS-Latam stocks flat; 'fiscal cliff' offsets China

 * China exports grow at fastest pace in five months
 * U.S. 'fiscal cliff' and Greece aid weigh on markets
 * Mexico IPC trading suspended after open
 By Asher Levine and Danielle Assalve
 SAO PAULO, Nov 12 (Reuters) - Latin American stocks were
flat on Monday with concerns over fiscal problems in the United
States and Europe offsetting positive economic data from China,
the region's important trade partner.
 The MSCI Latin American stock index was
nearly unchanged at 3,589.79 after the index found support at
its 125-day simple moving average, a level it has not closed
below in two months.
 Brazil's Bovespa remained flat, while trading on Mexico's
IPC index was suspended shortly after opening, with
traders citing technical problems. 
 Data released over the weekend showed exports in China -
Brazil's biggest trading partner and buyer of Latin American
iron ore, soy, copper and petroleum - grew at their strongest
pace in five months in October. 
 Still, investors remained concerned over the "fiscal cliff"
of spending cuts and tax increases which could go into effect in
the United States early next year unless Congress reaches a deal
on deficit reduction. Worries over the possible economic damage
from such a measure contributed to the worst drop in Latin
American stocks in nearly six months last week.
 "The China data shows a recovery in economic activity and
reinforces the expectation for that trend to continue," said 
Felipe Rocha, an analyst with Omar Camargo Corretora in
Curitiba, Brazil. "But the market continues to be wary of the
U.S. fiscal cliff and the situation in Greece, which still
hasn't been resolved," he said.
 Euro zone finance ministers will meet later on Monday to
discuss Greece's progress on controlling its debts though they
are not expected to release a new tranche of funding despite
Athens approving a tough 2013 budget on Sunday. 
 Brazil's benchmark Bovespa stock index was
little-changed at 57,360.36 points.
 Preferred shares of steelmaker Usiminas rose 2.8
percent while common shares added 3 percent after
Goldman Sachs Group analysts raised their recommendation for
both to "buy" from "neutral". 
 Homebuilders MRV Engenharia and Cyrela 
fell 2.25 percent and 1.6 percent, respectively. Brazilian
homebuilders likely saw net income decline in the third quarter
as cooling demand forced some to slash new projects and step up
marketing expenses, according to analysts in a Reuters survey.
 Energy generator CESP fell 4.4 percent after the
company's chief financial officer resigned on Friday, when the
company posted third-quarter results that were in-line with
expectations. The company did not disclose a reason for the
executive's departure. 
 UBS analysts said in a report on Monday that the resignation
suggests a tail risk of CESP accepting the negative terms of a
government concession extension at low tariffs.
 Brazil's stock market will be closed on Thursday and on Nov.
20 for national holidays.
 "We could see more volatility in the coming days,
considering we have the holidays and the expiration of index
options next Monday," Rocha added.
 Chile's IPSA index fell for the fourth straight
session, losing 0.26 percent to 4,226.94, a level the index has
not closed below in six weeks. 
 Industrial conglomerate Copec fell 0.8 percent,
contributing most to the index's losses, while regional energy
group Enersis slipped 1.3 percent. 
 Latin America's key stock indexes at 1433 GMT:
 Stock indexes                           daily %      YTD %
                       Latest          change     change
 MSCI LatAm                  3,589.79      -0.05       -0.3
 Brazil Bovespa             57,330.90      -0.05       1.02
 Mexico IPC                 40,680.87  suspended       9.72
 Chile IPSA                  4,226.94      -0.26       1.18
 Chile IGPA                 20,692.86      -0.21       2.80
 Argentina MerVal            2,379.85      -0.42      -3.36
 Colombia IGBC              14,304.94      -0.05      12.94
 Peru IGRA                  21,067.52        0.1       8.19
 Venezuela IBC             367,247.75      -0.29     213.79
 (Additional reporting by Cesar Bianconi; Editing by Grant

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