Chile stocks end firmer

Chilean stocks closed higher on Friday, led by electric utilities as investors took advantage of lower prices ahead of quarterly earnings reports. Chile's blue chip IPSA stock index rose 1.53 percent to 2,433.04, pulling away from last week's two-year lows and bringing its gains for the week to nearly 8 percent. The all-market IGPA index closed 1.29 percent firmer at 11,652.60.
Chilean indexes were led higher by regional electric utilities. "Things are calm in the sense that there aren't the sharp losses we saw last week, but the market is still very volatile," said Andres Roman, desk manager with brokerage BICE.
Roman said market volatility was framed by weak US data, which confirmed that problems were spreading to the real economy, and by earnings expectations. "And utilities are up exactly because of expectations for strong quarterly results," Roman said.
Endesa Spain's regional utilities, investment arm Enersis and generator Endesa Chile, rose 1.33 percent and 2.17 percent, respectively. The two companies combined account for about 20 percent of capitalisation on the blue chip IPSA. Endesa Chile stock has risen about 20 percent this year on improved hydroelectric reserves and higher wholesale electricity prices.
Percentage gain leaders included Potassium-based fertiliser exporter Soquimich with a surge of 7.17 percent to 11,850 pesos after sinking 7.89 percent on Thursday. Retailer advances were led by department store chain La Polar, with a gain of 5.45 percent. Dominant air carrier saw its shares rise 3.83 percent to 5,399 pesos a share.
LAN has seen increases of 13 percent in passenger traffic and of 11.8 percent in cargo traffic in the first three quarters compared with the same period last year, but its shares are down some 20 percent in the year to date. Markets are not expected to be much calmer next week as companies continue publishing third-quarter reports. "Volatility should continue for the next few months, on US economic data, and in reaction to corporate results. That's what will set the pace in the next few weeks internationally, and in Chile too," Roman said.