Mexican stocks fell on Friday, hurt by fears of higher US interest rates and despite optimism after Mexico's conservative candidate barely won the presidential election. The IPC stock index closed 1.09 percent lower at 19,829.60 points. The peso gained 0.56 percent to 10.997 per dollar, breaking below 11 per dollar for the first time in more than a month.
A US government report showing weaker job growth and rising wages in June stirred concerns about a slower economy and a pickup in inflation which could lead to higher US interest rates. That trumped optimism in the stock market caused by ruling party candidate Felipe Calderon's razor-thin election victory after a recount on Thursday.
Leftist rival Andres Manuel Lopez Obrador vowed to contest the result in the courts and on the street, although officials from his party promised on Friday that opposition would remain within the law.
On Thursday, the IPC index jumped 2.73 percent and the peso strengthened 1.63 percent because of the defeat of Lopez Obrador, who investors worried could endanger the country's economic stability.
Calderon's victory will likely mean a continuation of President Vicente Fox's push for low inflation and economic stability, although his slim win and opposition accusations of fraud could make badly-needed coalition-building difficult in Congress.
"We believe some short positions in Mexican assets, particularly on the peso, might be covered early next week, possibly pushing the peso down to the vicinities of 10.90," said WestLB economist Ricardo Amorim in a report.
Cellphone operator America Movil, one of the region's most widely held stocks, fell 2.34 percent to 19.21 pesos. Its New York-traded shares gave back 2.25 percent to $34.80.
Cement maker Cemex dropped 3.07 percent to 64.98 pesos and its American Depository Receipt was down 2.65 percent to $59.05. Retail powerhouse Wal-Mart de Mexico, expected to post a 25 percent rise in second-quarter net profit when it reports on Monday, gained 1.25 percent to 33.98 pesos. Sales of televisions ahead of the World Cup likely helped boost the company's bottom line, analysts say.
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