Chilean stocks surge

06 Aug, 2006

Chile stocks made moderate gains on Friday, pushed by an initial surge in global markets as investors bet on solid quarterly results. The blue chip IPSA index rose 0.52 percent to 2,147.41 points, while the all-market IGPA edged up 0.06 percent to 9,952.28, preliminary closing figures showed.
"We started really strong, but when US markets started going negative, we moderated too," said Jose Aguirre, a trader with the Euroamerica brokerage. "After 2:00 pm the market got really quiet."
Copper cable manufacturer Madeco was among the most heavily traded issues, as its stock backed off early highs to end the session up 2.59 percent at 51.50 pesos a share.
On Thursday afternoon Madeco reported its first-half profit more than doubled compared with last year, with net income rising to $36.9 million on revenue of $511.4 million as unit sales increased and copper prices soared.
Other gaining issues included regional energy group Enersis, with a rise of 0.73 percent to 127.51 pesos a share, and wood products manufacturer Masisa, as its stock jumped 2.37 percent to 86.50 pesos.
Forestry and paper products firm CMPC led blue chip declines as its shares slid 2.68 percent to 14,500 pesos a share after it reported first half net profit down 41 percent.
The company said lower earnings were due to higher fuel prices and other operating and freight costs.
"Next week there will be a lot of news," said Aguirre. "Financial results for retail will be coming out. We're also going to have the Fed and the central bank meetings. I don't anticipate any change, but there's always some uncertainty."
On Thursday, the Chilean central bank will hold its monetary policy meeting, where it is widely expected it will maintain the current target overnight lending rate of 5.25 percent.
On the foreign exchange market, the Chilean peso rose 0.28 percent to 541.50/541.80 per dollar compared to Thursday's close at 542.00/542.30.

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