Americas Stocks Retreat Amid Iraqi War Jitters
www.quicken.com Friday, January 24, 2003 10:51 PM ET Printer-friendly version A Wall Street Journal Online News Roundup
Americas markets finished lower Friday as war jitters weakened global markets amid reports the U.S. government had warned all citizens leaving overseas to be prepared to leave if necessary.
Although officials said the warning wasn't necessarily related to the Middle East situation, investors suspect the submission of a report on the state of Iraq's weaponry -- to be submitted by United Nations inspectors Monday -- could be a watershed moment in the standoff between Iraq and the U.S.
"Rumors that the U.S. will attack are playing on sentiment," said Fred Ketchen, managing director of stock trading at Scotia Capital Markets. The Dow Jones Industrial Average plunged 2.9% Friday.
In Toronto, the S&P/TSX Composite Index fell 72.53 points, or 1.1%, to 6664.90, with nine of 10 stock groups closing lower.
The information-technology group was the only gainer, up 1.1% on positive earnings surprises from heavyweights Nortel Networks and Open Text. Networking company Nortel ended up 24 Canadian cents to C$3.90 while e-business services provider Open Text rose C$2.68 to C$42.38.
The materials group slid 0.4%, its decline mitigated by the gold sub-index's 2.1% surge. Gold prices rose to six-year highs above $370 an ounce in New York as investors flocked to the safe-haven metal. Barrick Gold ended 64 Canadian cents higher at C$26.00 and Placer Dome rose 17 Canadian cents to C$17.97.
Meanwhile in Mexico City, the key IPC index gave up 41.88 points or 0.7% to 6012.56. Brewer Grupo Modelo's C shares lost 2.5% to 23.78 pesos and financial group BBVA-Bancomer's B shares dropped 1.6% to 8.11 pesos.
In Sao Paulo, the main Bovespa index lost 3.4% to 10783.65. Brazilian oil giant Petrobras, which could be hurt by the cost of importing more expensive crude, fell 4.9% to 45.11 reals.
Among the few shares ending ahead were mining company CVRD, which rose 1.4% to 89.70 reals, and beverage company Ambev, which climbed 0.9% to 478.00 reals. Ambev announced a share buyback early Friday.
Finally, the Merval index in Buenos Aires closed down 10.34 points, or 1.8%, to 557.82 despite the decision by the International Monetary Fund's executive board to approve a debt rollover accord for the South American nation. The pact had already gained preliminary approval.
The IMF approved a deal that will roll over of some $6.8 billion in debt payments the South American nation owes the international lender between January and August. The deal could open the way to similar rollover accords for Argentina with the World Bank and the Inter-American Development Bank.
Energy giant Perez Companc, which accounts for one quarter of the market, fell 4.2% to 2.30 Argentine pesos. The company continues to be negatively affected by the general strike in Venezuela, where the firm produces much of its oil.