Latin American stocks tracked their worst week in a month on Friday on continued uncertainty, though a major fund manager said Brazilian stocks had strong prospects beyond the short term. "I am bullish (on Brazil) in the medium to long term," said money manager Will Landers at BlackRock Inc, where he oversees about $10.5 billion in Latin American assets.
"The short term is a little tough. We still have uncertainties in the air," he said. "But overall I think the investment story is the same good one that it was a few months ago." Foreign investors have steadily pulled funds out of Latin America this year, turning instead to more developed markets. Latin American funds saw outflows of $28 million in the week ended April 13, according to data from Thomson Reuters Lipper.
But investors are eyeing a return, Landers said. "Demand for my time from clients is still very strong," he said. "There's room for a broad-based equity rally here. Markets just have to be patient." The MSCI Latin American stocks index added 0.44 percent in choppy trading, but was down 3 percent for the week, its worst such performance since March.
Brazil's benchmark Bovespa stock index dropped 0.41 percent for what could be a sixth losing session and was down 3.98 percent for the week. Shares of mining giant Vale dropped 0.63 percent. The stock has been volatile in recent sessions on fears of ramped-up government interference as speculation swirled about political pressure for the ouster of chief executive Roger Agnelli. A new CEO will take over Vale in May.
On the upside, shares of energy company Petrobras rose. Preferred shares added 0.46 percent as the company's common stock rose 0.83 percent. The company got a boost from a news report that the government was weighing whether to reduce fuel taxes, which could allow Petrobras better margins on gas prices without raising costs for consumers and pressuring inflation.
Mexico's IPC stock index slipped 0.14 percent as shares in media giant Televisa fell 1.93 percent after posting a surprise 17.8 percent drop in first quarter net earnings, hurt by the loss of advertising from companies run by billionaire Carlos Slim. Chile's IPSA index edged up 0.28 percent, led by gains in retailers Falabella and Cencosud. Peruvian stocks extended a recovery in the previous session and rose 3.26 percent. Those stocks tumbled earlier this week on scepticism about left-wing presidential candidate Ollanta Humala's pledge to manage the economy prudently if elected.