Empresas ICA SAB plunged for a fourth straight day and fell to a 12-year low as diminished growth expectations for Mexico hurt the nation’s biggest builder.
Shares dropped as much as 15 percent to 7.56 pesos, the worst intraday performance since August 2011, before slumping 8.1 percent as of 1:01 p.m. in Mexico City. ICA was the biggest loser on the benchmark IPC index, which was little changed.
The central bank lowered its 2015 growth forecast on Wednesday, saying Latin America’s second-largest economy will expand 1.7 percent to 2.5 percent, compared with the previous estimate of 2 percent to 3 percent. The damped outlook is hurting ICA’s stock, according to Invex Casa de Bolsa SA analyst Hugo Mendoza.
“It’s a signal that public spending could be reduced extensively for 2016,” Mendoza said in a telephone interview. “If that’s the case, ICA would be negatively affected.”
Asked why the stock plunged, Chief Executive Officer Alonso Quintana said in a telephone interview that “there are a series of factors like volatility, the slowdown of the economy, maybe the uncertainty of whether there will be a budget for more investment in the types of construction that we do.”