Adamant: Hardest metal
Saturday, July 5, 2003

Mexico's Telmex, Cemex and Brazil's Embraer Fall: Latin Stocks

June 23 (Bloomberg) -- Mexico's benchmark stock index is heading toward its largest one-day drop in a month, following equity markets in the U.S., the buyer of almost 90 percent of the Latin American country's exports. Telefonos de Mexico SA, the country's biggest phone company, led declines.

The Mexico City-based Bolsa index fell 77.59, or 1.1 percent, to 7003.10 by 1:43 p.m. New York time, its fourth day of declines. Brazil's Bovespa index of the most-traded stocks on the Sao Paulo stock exchange fell 1.3 percent to 12,966.94, a fourth day of decline.

``Telmex is linked to the U.S. markets,'' said Gerardo Lozoya who manages $80 million in Latin America stocks for Investra Consultores in Monterrey, Mexico.

The Standard & Poor's 500 Index fell 15.58, or 1.6 percent, to 980.12, the third drop in four days. The Dow Jones Industrial Average declined 1.5 percent to 9064.92 and the Nasdaq Composite Index shed 2.1 percent, to 1609.73.

In other markets, stocks in Argentina, Chile and Peru fell, while in Venezuela they rose. Markets in Colombia are closed for the Corpus Christi holiday.

The following stocks are having significant gains or losses in Latin American markets today. Symbols are in parentheses after the company name. In Brazil the preferred share is usually the company's most-traded class of stock.

Mexico

Telmex (TELMEXL MM) fell 42 centavos, or 2.5 percent, to 16.47 pesos, its lowest level in two weeks.

Cemex SA (CEMEXCP MM), the world's third-largest cement maker, fell 88 centavos, or 1.9 percent, to 46.21 pesos. The company said last week its global sales in the second quarter likely rose 6.3 percent compared with the same period of last year though sales in the U.S. fell.

Grupo Iusacell SA (CELV MM), Mexico's third-largest cellular phone provider, surged 8 centavos, or 30 percent, to 36 centavos. The stock has more than doubled in the last four days. Analysts say some minority shareholders expect Ricardo Salinas Pliego, who bought the controlling stake in Iusacell held by Verizon Communications Inc. and Vodafone Group Plc, may negotiate a reduction on the company's $800 million debt. ``Isuacell's stock is 100 percent speculative,'' said Lozoya.

Grupo Mexico SA (GMEXICOB MM), the world's third biggest copper producer, fell 25 centavos, or 1.6 percent, to 15.15 pesos as the price of copper for three-month delivery fell $15, or 0.9 percent, to $1,690 a metric ton on the London Metal Exchange. The price of copper lost 1.7 percent in the last three days.

Grupo Modelo SA (GMODELOC MM), Mexico's largest beer maker, fell 9 centavos, or 0.4 percent, to 24.01 pesos. Reforma newspaper reported the company plans to build a $1.5 billion plant in western Colima state, and to spend $350 million to boost capacity at two existing plants.

Brazil

Eletropaulo Metropolitana SA (ELPL4 BS), Latin America's largest power distributor, fell 62 centavos, or 2.3 percent, to 26.19 reais. Gustavo Gattass, an analyst with UBS Warburg SA, cut his recommendation on the shares to reduce'' frombuy'' and lowered his target price for the stock to 30 reais from 45 reais.

Empresa Brasileira de Aeronautica SA (EMBR4 BS), the world's fourth-largest aircraft maker, fell 29 centavos, or 2.1 percent, to 13.61 reais, on reports that one of its clients, Swiss International Air Lines Ltd., may cut 28 percent of its intercontinental fleet as part of a plan to reduce costs.

Petroleo Brasileiro SA (PETR4 BS), the state-controlled oil company known as Petrobras, fell 85 centavos, or 1.7 percent, to 50.25 reais. The Rio de Janeiro-based company said it agreed to pay $59 million of Houston-based Halliburton Co.'s claims over delays in building offshore oil production platforms. Halliburton, the world's second-largest oilfield-services company, said last week second-quarter profit will plunge because of the delays, and that it's seeking $375 million in claims from Petrobras.

Tele Norte Leste Participacoes SA (TNLP4 BS), the country's largest telephone company, fell 53 centavos, or 1.6 percent, to 33.62 reais. The telecommunications regulator is to release this week rate increases for fixed-line phone calls.

Argentina

Grupo Financiero Galicia SA (GGAL AR), the country's second- largest banking group, fell 5 centavos, or 3.7 percent, to 1.29 pesos. Galicia fell after reaching last week its highest price since July 2001. ``This drop is a normal reaction after a big gain,'' said Santiago Caronni, a trader at Puente Hermanos Sociedad de Bolsa in Buenos Aires.

Solvay Indupa SAIC (INDU AR), a company that produces PVC, rose 15 centavos, or 6.9 percent, to 2.32 pesos, the biggest gain in five weeks. ``Solvay is related to the construction industry, which rose 36.3 percent in the first quarter from the same period last year,'' said Caronni.

Telecom Argentina Stet-France Telecom SA (TECO2 AR) fell 25 centavos, or 5.9 percent, to 4 pesos after gaining 4.2 percent on Friday.

Peru

Cia. de Minas Buenaventura SA (CMB/C PE), Peru's biggest gold and silver miner, fell 7 centimos, or 1.3 percent, to 52 soles. Shares fell as the price of gold for three-month delivery dropped 1.3 percent to $352.10 an ounce on the Comex division of the New York Mercantile Exchange.

Credicorp Ltd. (BAP PE), Peru's biggest financial holding company, rose 11 cents, or 1.1 percent, to $9.91, gaining for a second day. Credicorp owns Peru's biggest bank Banco de Credito del Peru SA.

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