--IPC stock index up 0.3% in early trade
--Markets lifted by news of European Union loans for Spain
--MXN modestly stronger vs. USD in cautious trade
By Amy Guthrie
MEXICO CITY--Mexican shares opened higher Monday, joining a
global-market celebration following Spain's weekend agreement to
seek bailout funds for its banks.
The IPC index of Mexico's most-traded shares was recently up 114
points, or 0.3%, to 37438 on volume of 16 million shares, valued at
286 million pesos ($21 million). The peso was also modestly
stronger against the U.S. dollar, at MXN13.9275 compared with
MXN13.9385 at the close Friday.
European markets traded sharply higher after Spain agreed to an
aid package of as much as 100 billion euros ($125 billion) in loans
from the European Union to assist its banks, although stocks came
off highs as investors looked more critically at the bailout
accord.
"While it can be argued, and we will, that the amount will
likely prove insufficient...the most important thing today is that
European officials have innovated and responded," Brown Brothers
Harriman said in a note.
Mexican brokerage Banorte-Ixe warned that the relief rally
caused by news of aid for Spain may only be temporary. The
brokerage recommends light exposure to Mexican equities given
likely further headwinds from Europe and signs of slowing global
growth.
Among Mexican blue chips early Monday, wireless carrier America
Movil SAB (AMX, AMX.MX) was gaining 0.6% to MXN16.56, while cement
maker Cemex (CX, CEMEX.MX) was rising 1.5% to MXN7.69 and retailer
Wal-Mart de Mexico SAB (WMMVY, WALMEX.MX) was up 0.4% to
MXN34.95.
In local economic news, Mexican industrial output maintained a
healthy rate of growth in April, expanding 3.6% from a year earlier
with gains in manufacturing and construction offset slightly by
lower oil production.
The 3.6% increase from April 2011 was below the 4.5% median
estimate in a Dow Jones Newswires survey of eight economists, but
above the 3% year-on-year rate registered in March.
Write to Amy Guthrie at amy.guthrie@dowjones.com.