The main index of the Mexican Stock Exchange (BMV), the S&P/BMV IPC, closed this Monday with its best performance since September 12, due to the optimism that investors have with the financial results of the companies and for a perspective of a less restrictive monetary policy, since inflation registered a deceleration in the first half of October.
The S&P/IPC BMV closed at 47,765.24 points, an increase of 1.37%, its best level in almost six weeks, while the FTSE BIVA ended at 997.45 points, with an increase of 1.37%, its best level since last August 22 .
The issuers whose shares registered the greatest advance were Peñoles, with an increase of 8.64%; North Center Airport Group (OMA); Volaris, with 3.7%; Mexican Economic Development (FEMSA), with 3.5% and Arca Continental, with 3.23%.
Wall street is also up
In New York, US stocks also closed higher on Monday, extending last week’s gains, as signs of economic weakness suggested that the effects of the Fed’s aggressive policy aimed at cooling the economy – and thus curbing the inflation – are starting to take root.
The Dow Jones ended the day with an advance of 31,500.61 points, which meant a growth of 1.34%. The S&P 500 and the Nasdaq increased 1.19% and 0.86%.
“With investors awaiting updates on corporate earnings trends from Big Tech names, there was no fresh catalyst for today’s move. However, recent political and fiscal developments in the UK helped bond markets and European stocks,” said analysts at Edward Jones’s consultancy.
Among the highlights this week will be reports from Alphabet and Microsoft on Tuesday; Meta on Wednesday, and Apple and Amazon on Thursday, all after market close. Ad spending and dollar strength are expected to weigh on results and guidance, but analyst estimates have been adjusted lower over the past month, which could set a low for companies to break through. .
Oil falls on the strength of the dollar
Oil closed lower on Monday on data showing Chinese demand remained lackluster in September, while weakening US trade eased expectations of more aggressive rate hikes.
Brent crude futures for December delivery settled at $93.26 a barrel, down 24 cents or 0.3%, after rising 2% last week. US crude, WTI, closed at 84.58 dollars a barrel, after losing 47 cents or 0.6%. Both contracts had fallen $2 a barrel earlier in the session.
Oil prices recovered some ground after data showed US business activity contracted for the fourth consecutive month in October, with manufacturing and service companies in a monthly survey of purchasing managers reporting that demand for customers was weaker.
Weight remains stable
The Mexican peso was quoted at the close at 19.9295 per dollar, with an appreciation of 0.03% compared to the reference price on Friday, according to data from the Bank of Mexico. The move came after cutting initial losses on the inflation data, which reaffirmed bets that the central bank will have to continue raising its key interest rate.
Gabriela Siller, director of analysis at Banco Base indicated that although the exchange rate has shown stability, the dollar gained ground with the weighted index advancing 0.36% against its main crosses, due to nervousness regarding: Risks for the global economic growth, after the publication in Europe of unfavorable PMI indicators for October, mainly in Germany and the United Kingdom. The foregoing contributed to falls in the prices of raw materials and losses for several currencies of countries dedicated to the production and exports of commodities.
Second, the continuity of the Xi Jinping government in China, mainly affecting the markets during the Asian session, and third, the expectation that the Federal Reserve will raise its interest rate by 75 basis points on November 2. Fed officials are no longer scheduled to comment during the week ahead of next week’s announcement.
With information from Reuters