Chilean stock indexes erased early losses to end nearly flat on Friday, as late session gains led by iron ore exporter CAP helped offset oil and credit worries. The all-market IGPA index closed 0.1 percent lower at 13,753.75 points, bringing its loss for the week to 1.9 percent, while the blue chip IPSA index ended 0.08 percent lower at 2,919.68 points.
Wall Street fell following news of a $7.8 billion quarterly loss linked to subprime loans at AIG, the world's largest insurer, and as oil peaked above $126 on Friday in a fifth straight session of record gains.
"The market has become more pessimistic about oil prices, and clearly if they stay at this level it's going to affect productivity," said Rodrigo Martin, head of market research at Banchile. Early session losses on the Santiago exchange were pared as steelmaker and iron ore exporter CAP surged 3.3 percent to end the session at 16,185 pesos a share.
CAP stock has been gaining on rising prices for steel and iron ore, driven by booming Asian demand. Other late session advancing issues included department store Chain Ripley up 2.19 percent and telecommunications company Entel Chile, advancing 2.08 percent.
Dominant air carrier LAN closed 1.42 percent lower, its fifth day of declines amid record high prices for oil. Leading Endesa Spain regional electric utilities also weighed, as shares in generator Endesa fell 1.54 percent and Enersis slipped 0.54 percent.
Losses by retailers were led by regional giant Cencosud, as its shares dipped 2.33 percent. Of Chile's 40 blue chip stocks, 21 closed lower, 12 rose, and seven were unchanged.
The Chilean peso appreciated 0.53 percent to close at 469.20/469.50 per dollar compared with Thursday's close at 471.70/472.20. The central bank has been buying $50 million worth of dollars a day as part of an $8 billion currency intervention to curb the strength of the peso against the greenback.
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