EMERGING MARKETS-Earnings, Fed bets lift Latam stocks

Published 10/29/2010, 03:20 PM
Updated 10/29/2010, 03:24 PM

* Brazil's Bovespa up 0.45 pct, Mexico's IPC up 0.5 pct

* Mexico earnings season over, collective profits up 8 pct

* Petrobras flat after Libra oil find sized (Adds commentary, updates prices)

By Caroline Stauffer and Silvio Cascione

MEXICO CITY/SAO PAULO, Oct 29 (Reuters) - Latin American stocks rose on Friday on positive corporate earnings reports and sustained bets the U.S. Federal Reserve will move to inject funds into the U.S. economy next week.

Earnings season has ended in Mexico, with companies collectively posting an 8 percent increase in third-quarter profit from the same period a year ago.

"Today the market is primarily riding on upbeat company earnings," said Tulio Chavez, a trader at brokerage Actinver in Mexico City. "But we also continue to see liquidity from the Fed speculation."

The MSCI Latin American stocks index <.MILA00000PUS> added 0.87 percent. Expectations of a cash injection from the U.S. central bank have helped Latin American stocks pack on nearly 12 percent since Sept. 1.

Mexico's IPC <.MXX> added 0.5 percent.

Retailer Elektra , which is controlled by media and telecom baron Ricardo Salinas, jumped 4.44 percent after third-quarter earnings beat expectations.

"Elektra turned in the best results of the industry," Fernando Olvera, an analyst at BBVA Bancomer, wrote in a research report on Friday. "Recovering consumer demand in Mexico should favor the company in 2011."

Elektra specializes in selling big-ticket appliances to low-income clients and charges high interest rates.

In Brazil, the BVSP <.BVSP> gained 0.45 percent.

"On balance, earnings reports have been positive," said Alvaro Bandeira, director of Agora brokerage in Sao Paulo.

But investors could turn cautious before the market's close ahead of Sunday's presidential election in Brazil, he added.

The most commonly traded shares of Petrobras edged up 0.08 percent. The shares gained 8.13 percent during a six-session rally.

Most of those gains came on trader speculation the state-run company was preparing to unveil a large oil find.

The ANP oil regulator said on Friday that the Libra oil prospect could hold as much as 15 billion barrels of oil equivalent. [ID:nN29160461]

Nonvoting shares of Usiminas , the most commonly traded, added 2.19 percent. The shares rose for a second session after the company reported better-than-expected third-quarter earnings. Voting shares jumped 6.14 percent.

Chile's blue-chip IPSA index <.IPSA> added 0.45 percent.

Data on Friday showed Chile's jobless rate for the July-September period was 8.0 percent, slightly below market expectations and down from the June-August period.

"Unemployment data in Chile, which was relatively good, and economic data from the U.S., which was as expected, have given stocks a positive impulse," said Gianmarco Pruzzo, a trader at Corpbanca in Santiago.

A technical trend indicator called the MACD also crossed above its signal line this week, suggesting an upward trend for the IPSA after a month of horizontal movement below 4,800 points. (Additional reporting by Alvaro Tapia in Santiago and Elzio Barreto in Sao Paulo; Editing by Dan Grebler)

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