A roundup of Tuesday’s stock market results from across the Americas
🌎 Chile’s IPSA leads LatAm gains:
In Latin America, the main index of the Santiago Stock Exchange (IPSA) continued its upward streak Tuesday and remains that with the highest accumulated gains, hitting a new high after after closing 1.44% higher to 6,286.50 points.
Almost all sectors of the Chilean Ipsa were in the green at the end of the day. Technology (2.86%), non-basic consumption (2.80%) and basic consumption (2.03%) led the gains. In addition, according to Credicorp Capital Bolsa, the most traded shares of the day were those of Falabella (FALAB; $14 million) and Banco de Chile (CHILE; $13 million).
Among the best performing shares of the day were those of Cencosud (CENCOSUD), up 3.87%; Banco de Chile, with gains of 3.11%; and Inversiones Aguas Metropolitanas (IAM), up 3.00%. In contrast, the shares that fell the most were those of Grupo Minero Siderúrgico de Chile (CAP), down 0.67%; and Latam Airlines (LTM), down 0.48%.
A Bloomberg report highlighted that the Ipsa is currently the second best stock market index among global reference indices, considering the last eight trading days: the IPSA’s rise in the previous three months stands at 13%, above the Mexican and Brazilian bourses, and the possibility of drastic reductions in their interest rates is causing Chilean equities to attract a number of investors in the world.
On Tuesday, the main index of the Colombian Stock Exchange (COLCAP) was the second best performer. The MSCI Colcap rose 0.83% to 1,169.79 points. Credicorp Capital Bolsa noted that the volume traded in the Colombian market amounted to US$9.64 million, led by shares of Bancolombia (PFBCOLO) and Cementos Argos (CEMARGOS).
Colombian billionaire Jaime Gilinski has increased his proposed acquisition of Colombian supermarket chain Almacenes Éxito. Bloomberg Línea was able to confirm that Gilinski sent the letter to Éxito’s largest shareholder, Cia Brasileira de Distribuição, on Tuesday, offering $586.5 million in cash for a 51% stake in the retailer.
The Mexican (MEXBOL) and Peruvian (SPBLPGPT) stock markets also closed higher, along with Argentina’s Merval (MERVAL).
🗽On Wall Street:
US equities rose Tuesday as results from Bank of America Corp. and Morgan Stanley bolstered bank shares, and a rally in stocks linked to artificial intelligence resumed.
Bank of America delivered a surprise gain from its core Wall Street businesses. Morgan Stanley executives pointed to an improved outlook. And in technology, Microsoft Corp. set an expensive price tag on new AI products, buoying the sector.
The S&P 500 gained 0.7% while Treasury yields pared earlier losses as the corporate updates were coupled with disappointing economic data. Figures on industrial production and retail sales missed estimates, and traders are now fully pricing in a quarter-point hike at the Federal Reserve’s meeting next week.
Signs of slowing inflation and an improving economic picture have led traders to dial back wagers on how high the US overnight benchmark rate will go. However, quarterly forecasts from policy makers have shown a median expectation of two more quarter-point increases this year in order to bring the rate of inflation in line with the Fed’s target.
“The current picture on the consumer is a bit blurry. It seems that excess savings buoyed retail activity in recent months but consumers are quickly depleting those excess reserves and starting to use credit to support spending habits,” Jeffrey Roach, chief economist at LPL Financial, said.
His comments were echoed by Rubeela Farooqi, chief US economist at High Frequency Economics, who said consumers continue to face constraints from higher borrowing costs and elevated prices. “However, a still-strong labor market, positive real disposable incomes and a gradual easing in price pressures appears to be supporting consumption for now.”
In Europe, stocks and bonds were also higher after ECB council member Klaas Knot said monetary tightening beyond next week’s European Central Bank meeting was anything but guaranteed — suggesting officials could soon pause their campaign of interest-rate hikes.
The Stoxx Europe 600 rose 0.6% while the yield on 10-year German securities fell nearly 10 basis points to 2.4%, touching a roughly two-week low.
“It’s clear that it’s the receding inflation narrative which is driving everything,” said Gilles Guibout, a portfolio manager at Axa Investment Managers in Paris. “Investors are feeding on hope: hope that US rates will get down sooner and hope that China will launch a stimulus package to beef up consumption.”
The wild card is China, where a stuttering recovery is leading to disquiet among investors considering the knock-on effects from a slowdown in the world’s growth engine. Equities in mainland China and Hong Kong fell Tuesday. Elsewhere, gold rose, oil gained and the dollar was little changed.
- The Bloomberg Dollar Spot Index was little changed
- The euro was little changed at $1.1230
- The British pound fell 0.3% to $1.3040
- The Japanese yen fell 0.1% to 138.89 per dollar
🍝 For the dinner table debate:
Panamanian former president Ricardo Martinelli, who governed the Latin American country between 2009 and 2014, was sentenced to 10 years and eight months in prison and ordered to pay a fine ofS$19.2 million as an accessory penalty.
The Public Prosecutor’s Office had requested that Martinelli be prosecuted for alleged crimes against the economic order in the modality of money laundering on the grounds that the former president solicited money from businesses for the purchase of Editora Panamá América S.A. (EPASA), which publishes the newspapers Panamá América and Crítica, among other publications.
The authorities affirmed that the ex-governor contacted contractors of the Panamanian State, among them representatives of the companies Transcaribe Trading, Excavaciones del Istmo and Grupo Clio, in order to carry out the purchase of EPASA.
Paola Villar S, a content producer at Bloomberg Línea, and Isabelle Lee of Bloomberg News, contributed to this report.