July 1 (Bloomberg) -- Wal-Mart de Mexico SAB, Latin America's largest retailer, rose to its highest in almost two weeks in Mexico City after Banco Santander SA said the company may report ``stable'' gross margins in the second quarter.

Walmex, as the company is known, gained 1.5 percent to 41.50 pesos. The stock has risen 7.7 percent this year, compared with a 1.6 percent decline in the Bolsa Index.

``We expect a stable gross margin year on year at 21.3 percent, which would be a remarkable achievement considering the ongoing aggressive pricing,'' Roberto Liano, retail analyst at Banco Santander's Mexico unit, wrote in note to clients.

Liano also said Walmex had ``significant opportunities for organic expansion.''

To contact the reporter on this story: Hugh Collins in Mexico City at Hcollins8@bloomberg.net

Last Updated: July 1, 2008 16:24 EDT