Morgan Stanley Ups Mexico’s Soriana To Overweight
Morgan Stanley raised its recommendation Monday on Mexican retailer Organizacion Soriana SA (SORIANA.MX) to overweight from equal weight, citing the attractive valuation of the shares.
Morgan Stanley said Soriana remains one of the better-valued retailers in Latin America, while downplaying risks from the company’s expansion plans, setting a price target of $5.50 a share.
“e have increased confidence that Sorianas expansion program won’ result in a meaningful deterioration in asset returns, based on our analysis of the company’s new stores/formats and on the pattern of new store openings,” the firm said in a report.
More: newratings.com
Morgan Stanley raised its weighting to Brazilian stocks as the prospect of lower local interest rates will increase investors' appetite for equities.
Higher than average commodity prices are likely to persist throughout the year with ``relatively low interest rates'' making ``the ideal environment for Brazil,'' wrote Mario Epelbaum, an equity analyst, in a report today.
Brazilian equities were raised 3 percentage points to 56.3 percent, by Morgan Stanley. The increase came at the expense of Mexico, which had its weighting reduced by 3 percentage points to 32.2 percent.
More: bloomberg.com
Mexicos Soriana quarterly net profit ticks up
Soriana, one of Mexicos top retailers, posted a 4 percent rise in net profit for the first quarter on Tuesday, below analysts estimates, with moderate growth in sales and operating results.
Soriana (SORIANAB.MX: Quote, Profile, Research) said net profit reached 548 million pesos ($50 million), compared with 525 million pesos in the same quarter of 2005. Analysts polled by Reuters Estimates had forecast a 14 percent rise to 597 million pesos.
Soriana, which operates 202 stores mainly in northern Mexico, said its quarterly sales rose 11 percent year on year to 12.395 billion pesos. Operating profit,
Mexico Makes Good on Debt
The Mexican Treasury announces the country has paid off its $1.41 billion in foreign debt to salvage and maintain the country’s financial stability through next year's presidential elections.
Officials say Mexico paid off a portion of 10 bonds due between 2007 and 2033 using funding purchased from the central bank.
President Vicente Fox promises to cover financing needs through 2007 to protect the economy from the financial crises associated with earlier presidential transitions.
Morgan Stanley analyst Gordian Kemen says the announcement came as a surprise to many, but "is very positive.
The government still has $430 million more than what
Mexico's Central Bank Reduces Rates to Boost Economy (Update1)
Mexico's central bank reduced its benchmark lending rate for a second time in as many months to help jumpstart a slowing economy, taking advantage of slowing inflation.
The Bank of Mexico said in a statement it will allow the overnight rate to decline to 9.25 percent from 9.50 percent following a reduction of 0.25 percentage point at its Aug. 26 meeting, which marked the first time ever the central bank set a rate for the market.
``The Mexican economy reduced its expansion rate during the first half of the year, showing lower
Mexico's Grupo TMM Sells 18 Mln Kansas City Shares
Grupo TMM SA, Mexico's largest transportation company, said it sold 18 million shares of Kansas City Southern common stock at $22.25 a share, about 10 percent lower than the U.S. railway's closing price yesterday.
Mexico City-based Grupo TMM said in a statement on Business Wire today that it sold the stock to Morgan Stanley and will apply the proceeds toward debt. Kansas City Southern shares fell 32 cents to $24.68 yesterday in New York Stock Exchange composite trading.
Kansas City Southern, based in Kansas City, Missouri, said separately it would offer 9
Mexico's Industrial Output Probably Rose 2% in September
Mexico's industrial production probably rose 2 percent in September, the latest evidence that the expansion in Latin America's second-biggest economy is sputtering as export growth to the U.S. slows.
Output growth of 2 percent -- the median estimate of 15 economists surveyed by Bloomberg -- would be down from 2.1 percent in August. It would also mark the fifth straight month in which production growth failed to reach 3 percent. Mexico had average monthly output growth of 3.8 percent last year.
``This economy is not robust,'' Gray Newman, chief Latin American economist at
Latin American Stocks Decline, Led by Mexico, on Rate Concerns
Latin America's benchmark stock index fell to the lowest level in more than a month as rising interest rates worldwide prompt investors to pull money out of riskier securities such as equities.
The Morgan Stanley Capital International index of Latin American stocks fell 1.7 percent to 1879.60 as of 12:37 p.m. New York time, its lowest level since Sept. 5, led by Mexico's America Movil, Latin America's No. 1 wireless telephone company.
``Investors are getting out of volatility to go to safe havens,'' said Alfredo Rotemberg, who helps manage $220
Mexico, Brazil Inflation Slows, Paving Way for Rate Reductions
Slowing inflation in Mexico and Brazil, Latin America's two biggest economies, is paving the way for central bankers to cut interest rates and curb gains in their currencies, analysts such as UBS AG's Michael Gavin said.
Government reports scheduled for release today will show Mexico's annual inflation rate dropped to a record low in September while Brazil's rate held near its lowest in 16 months, according to more than a dozen economists surveyed by Bloomberg.
Declining inflation rates may prompt Mexico to reduce its benchmark lending rate for a third straight
Should the United States shut the door to Mexico?
The history of the relationship between Mexico and the United States, especially since each country gained independence in 1821 and 1776 respectively, has seen more than enough ups and downs.
Geographic proximity has brought about an assimilation of neighbors, and when something important happens on one side of the border it has an effect on the other. Locally a cultural or social event, a birth, a wedding or death, they always transcend the border.
Yet sociopolitical affairs often make the two countries “distant neighbors,†as opposed to close friends.
This coming year will be
Mexico recall veteran Suarez
Veteran defender Claudio Suarez was named in Mexico's squad for Wednesday's (Thursday AEDT) friendly against Paraguay.
Nicknamed the Emperor, Suarez has been picked sporadically by coach Ricardo La Volpe in the last two years. His last appearance was in the 2-0 win over Hungary in December.
Mexico are using Wednesday's (Thursday AEDT) game in Chicago as the latest in a series of warm-ups for the World Cup where they will face Iran, Angola and Portugal in their first round group.
La Volpe also included striker Jared Borgetti in the squad although his presence could depend on negotiations
