Chile stocks ease from record high

26 Nov, 2006

Chilean stocks eased slightly on Friday from another week of record highs as investors shrugged of valuation worries. The all-market IGPA index slipped 0.09 percent to 11,659.58, while the blue chip IPSA index fell 0.06 percent to 2,542.70, preliminary closing figures showed.
"Long-term interest rates have come down. That's driving money out of fixed income into equities," said Ben Laidler, an analyst with UBS in Santiago. "You're seeing it in retail investors, in mutual funds, and pension funds."
Laidler said a valuation bubble was slowly building at the same time as economic fundamentals were down. Chile's central bank on Thursday reported third-quarter economic growth at 2.9 percent compared with the same period last year, the slowest quarterly growth rate in nearly three years.
Shipping company Vapores led blue chip advances for a second day, surpassing Thursday's surge of 5.6 percent with a gain of 6.3 percent to 785 pesos a share. Through September Vapores posted a loss of $111 million amid lower tariffs and higher fuel costs.
Copper cable and pipe manufacturer Madeco rose 2.56 percent in heavy trade to 58 pesos a share. Madeco profit in the first nine months of the year rose 163 percent from the same period last year.
Electric utility and retail heavyweights moderated index gains, as generator Endesa Chile slipped 0.46 percent to 613 pesos a share and leading department store chain Falabella fell 0.97 percent to 1,842 pesos a share. LAN Airlines also gave back some gains from its recent extended rally with a decline of 1.64 percent to 5,400 pesos.

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