Mexico’s IPC index plunged the most among the world’s major stock benchmarks, touching an eight-month low, as concern mounted that growth is slowing in Latin America’s second-biggest economy.
The IPC fell 1.6 percent to 40,405.26 at 10:52 a.m. in Mexico City trading, the lowest since September on a closing basis. Empresas ICA SAB (ICA*) slid 5.8 percent, extending a two-day decline to 13 percent, the worst such slump since August 2011. Fomento Economico Mexicano SAB (FEMSAUBD), owner of Latin America’s largest convenience-store chain, dropped 3.5 percent after Credit Suisse Group AG reduced its recommendation to the equivalent of sell from hold.
Mexican stocks have underperformed U.S. shares and Latin American peers since a May 17 report showed gross domestic product rose 0.8 percent in the first quarter from a year earlier, the slowest since a 6.2 percent contraction in 2009. About 75 percent of Mexican companies on the IPC index missed earnings estimates in the first quarter, according to data compiled by Bloomberg.
“We’ve seen data suggesting an economic slowdown in Mexico, which has been affecting the attitudes of investors,” Arturo Espinosa, an equity strategist with Banco Santander SA’s Mexico unit, said in a phone interview today from Mexico City. “We had seen weakness in other emerging-markets like Brazil and China, but Mexico had been able to avoid that.”
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