Mexican stocks gained 1.86 percent on Friday, with strong gains in airport operator Asur and cellphone operator America Movil, as investors bet buying by pension funds will drive the market higher. The benchmark IPC stock index jumped 231.84 points to finish at 12,694.74, bringing its gain over the two most recent sessions to about 3 percent.
As of Monday, Mexican pension funds will be able to invest part of their assets for the first time in local and international stock indexes through derivatives that guarantee principal.
Investors in Mexico have long expected the limited entry of the pension funds into the stock market to boost share prices, but some market participants remain cautious.
"There was a lot of liquidity on Friday, over-estimating the effect of the pension funds in the market," said Manuel Lasa, head of stock trading at Interacciones brokerage in Mexico City.
Credit Suisse First Boston said on Thursday it expected most pension funds to focus more on international indexes than on Mexico's IPC.
"We don't discard more profit-taking," said Rogelio Gallegos, a portfolio manager at Actinver mutual fund and pension fund company. "Next week will probably be mixed."
Airport operator Asur was among the top gainers, rising 4.31 percent to 30.25 pesos, while its New York-traded share surged 4.75 percent to $27.11.
Mobile phone operator America Movil, the most heavily weighted stock in the IPC index and a big winner in 2004, rose 3.05 percent to 28.36 pesos and its American Depositary Receipts added 2.80 percent to $50.58.
TV Azteca rose 0.46 percent to 6.59 pesos after Morgan Stanley raised its 2004 revenue estimates for TV Azteca on improved advertising but warned of higher costs and uncertainty about the outcome of US fraud charges against the company. TV Azteca's ADR picked up 0.21 percent to $9.41.
The peso weakened 0.11 percent to 11.2180 after the central bank left its monetary policy unchanged at its twice-monthly review.
The value of peso in recent weeks has been determined more by weakness in the dollar versus other currencies than by fundamental changes in Mexico's economy.