International Business : Global Markets and Economic Update
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MEXICAN STOCKS
* Stocks closed higher in very light trading as a strong rally by the peso spurred a round of speculative buying. A weakening peso pushed the Bolsa index 4.1% lower last week.
* A tight monetary policy “is good for Mexico in the long run, but it will make the short-term ride very rough indeed,” said Perry Winfield, Mexico equity strategist at Paribas Capital Markets Group in New York. “For that reason, we’re underweight in Mexico for the time being.”
* Gross domestic product, which fell 5.8% in the first half of this year, is expected to fall 5% for all of 1995. That doesn’t bode well for earnings at large public companies.
Sources: Bloomberg Business News, Dow Jones
SPOTLIGHT: VENEZUELA
Financial debacles have scuttled attempts to restore confidence in the inflation-wracked economy of Venezuela, South America’s top petroleum producer. The heavy reliance on oil, which provides 80% of the government’s revenue, makes the country acutely susceptible to changes in the global petroleum market.
Source: Bank of America World Information Services
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