Latin American Stocks Following Commodites Lower; Mexico Central Bank Keeps Key Rate Steady at 4.5%

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Latin American stocks are mostly lower this morning on declines for crude oil, gold and other commodities following disappointing trade data out of Germany today and uncertain prospects on how the Spanish banking crisis may be resolved.

Here's where the regional market guages stand this morning:

- Ibovespa down 148.46 -0.27% 54,007.5781

- IPC (Mexico City) down 43.21 -0.12% 37,204.13

- Santiago Index IPSA up 1.98 +0.05% 4,286.46

- Merval Buenos Aires down 23.18 -1.04% 2,204.40

Mexico's central bank, as expected, today held the country's benchmark interest rate steady at 4.5%. Most analysts thought the Banco de Mexico would keep its base rate at the same level it has had since 2009 although there had been some speculation the central bank would cut rates given Mexico's slowing pace for inflation.

Minutes released this morning of Brazil's central bank's last meeting in late May had policy-makers saying its economy is recovering at a "very gradual pace," likely indicating the monetary policy committee of the Banco Central do Brasil will again cut its benchmark rate by 0.5% to an 8.0% rate when it meets again next month, Bloomberg reports.

In company news, U.S.-lised shares of Gafisa SA ( GFA ) are flat again at $2.26 each, paring an earlier 2% decline that followed the Brazilian real estate developer announcing plans to sell stock and raise funding to buy the remaining stake in Alphaville Urbanismo that already doesn't own.

GFA will sell 70.2 million shares to finance the acquisition of the final 20% ownership interest in Alphaville Urbanismo, a luxury housing community subsidiary that's been the company's most profitable unit.

At the stock's current price, the offering would produce about $155 million in gross proceeds before underwriting and other offering expenses. GFA estimates the 20% stake is worth about BRL359 million, or about $176.2 million.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: GFA

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