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Thursday, March 29, 2012

Benchmark IPC Equity Index Climbs to Record: Mexico City Mover

Mexico’s benchmark IPC stock index climbed to a record as a pickup in the U.S. economy buoyed optimism in the outlook for its southern neighbor.


The gauge rose 1.4 percent to 38,863.15 at the close of trading in Mexico City. The IPC has rallied 23 percent since reaching a one-year low on Aug. 8. The MSCI Emerging Markets index is up 5.5 percent in the period.

Signs of resilience in the world’s biggest economy and easing concern about Europe’s debt crisis are spurring a return to emerging-market equities from Russia to Brazil.

The number of Americans signing contracts to buy previously owned homes held in February near an almost two-year high, a report showed today. U.S. data in the past month have shown the unemployment rate at the lowest level since February 2009 and manufacturing expanding for the 31st straight month.

“All the sectors in the U.S. on which Mexico depends in a significant way are showing strong growth,” Jorge Lagunas, who oversees about $200 million as a money manager at Grupo Financiero Interacciones SA, said in a telephone interview from Mexico City. “Mexico’s economy is advancing in the same way.”

Mexico sends about 80 percent of its exports to the U.S.

Construction-related companies were among the biggest gainers on Mexico’s benchmark since the August low.

Cemex SAB (CEMEXCPO), the largest cement maker in the Americas, surged 64 percent in the period. Empresas Ica SAB, the country’s largest construction company, rose 46 percent.

Mexico’s peso has climbed 9.3 percent this year through March 23, adding to equity returns for foreign investors. The peso is the best performer among major currencies tracked by Bloomberg in the period.

bloomberg.com

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