By Carla Mozee

Mexican equities fell Wednesday, with communications stocks among those unable to gain traction as investors booked gains from a recent run of record highs.

Mexico's IPC index fell 0.9% to 33,517.18, giving back the bulk of Tuesday's jump of 1.1%.

Decliners on Wednesday included the telecommunications sector, where shares of all listed shares finished in the red. Mexican market heavyweight America Movil (AMX) fell 1.3%, and its takeover target Carso Global Telecom lost 1.7%. Axtel lost 1.5% and fixed-line operator Telmex (TMX) shed 0.7%.

Itau Securities in a Tuesday note to clients said it expects Telmex to post "weak" first-quarter operating results as the company deals with competition from wireless, cable-TV and smaller fixed-line companies. The broker said Telmex likely lost at least another 50,000 voice lines during the quarter to 15.8 million.

"In our view, this weakness is highly unlikely to be offset by a strong performance of the corporate networks and broadband businesses where the company continues to implement an aggressive pricing strategy in order to defend its position," wrote Itau analyst Martin Lara.

Among broadcasters, Televisa (TV) led overall market decliners as its shares slumped 3.2% and TV Azteca fell 0.3%. Among home builders, Urbi fell 0.9% and Consorcio Ara lost 0.6% while Homex (HXM) shares picked up 0.3%.

Shares of Banco Compartamos led price performers with their rise of 1.8%, paring heftier gains. The lender late Tuesday posted first-quarter net earnings of 400 million pesos from 288 million pesos in the year-ago period, in part as loan portfolio rose 34.1%.

The IPC index, after a number of fresh record closes, hit its highest closing level on April 15 at 34,134.23 as investors position themselves to benefit from economic improvement in the country as its largest trading partner, the United States, continues to recover.

Mexico sends about 80% of its goods to the U.S., and Mexico is the U.S.' second-largest trading partner.

The International Monetary Fund on Wednesday, as part of an upgrade of its global economic growth forecast for this year, said it now expects Mexican growth in 2010 of 4.2%, "helped in part by the U.S. recovery." The forecast was revised upward by 0.2%.

For 2011, it sees Mexican growth of 4.5%, a decline of 0.2% from its previous outlook in January.

Gross domestic product in Mexico slid 6.5% in 2009.

Mexico's currency rose following the report, trading at 12.176 pesos per dollar compared with 12.234 pesos on Tuesday. At the same time, the iShares MSCI Mexico Index fund (EWW) fell 0.4%.

Growth in Latin America and the Caribbean is recovering "at a robust pace," that's being led by strong domestic consumption and aided by improving financial conditions, said the IMF. It now expects growth of 4% in the region this year, up 0.3% from its previous forecast issued in January.

The Washington-based organization pulled its forecast for Brazilian growth up by 0.8% to 5.5% for 2010, and up by 0.4% to 4.1% in 2011.

The IMF's new global growth forecast for 2010 is 4.2%, up from 3.9%.

Elsewhere, Chile's IPSA index fell 2 points to 3,829.78 and Argentina's Merval slipped less than 1 point to 2,453.61.

Trading in Brazil was closed Wednesday for a holiday.