Brazilian stocks rose on Friday as moves in the eurozone to ease a debt crisis calmed nerves and a local tax on imported cars boosted steelmakers, although stocks in the region suffered with commodity prices. Brazil's benchmark Bovespa stock index added 1.5 percent, while the MSCI Latin American stocks index fell 0.2 percent, as lower prices for raw materials hit heavyweight commodity exporters in the index.
The regional index was nearly flat for the week, as investors fretted about the global economy in a week full of developments in Europe's sovereign debt crisis that some say could see Greece exit the 17-country eurozone. Co-ordinated action on Thursday from the European Central Bank, the US Federal Reserve and other major central banks to shield European banks from the fiscal crisis eased some fears.
The impact of that move carried over to Friday, said Marcello Paixao, a partner and fund manager at Principia Capital Management. But he said markets were still nervous, with investors reluctant to take long-term positions and volumes dropping. "The market is without any definition, waiting to see what they decide in Europe," he said. After a recent wave of sell-offs, he said, "when the market began seesawing around the same levels, liquidity dropped off a lot."
Liquidity has also become more concentrated in larger stocks, he said, with smaller equities suffering a bigger drop-off in volume. In Brazil, where policymakers unveiled steps late on Thursday to shield local automakers from imports, investors in the domestic steel industry cheered the moves.
Steelmaker CSN gained 4.2 percent as rival Usiminas rose 1.2 percent. The group of companies that control Usiminas denied there was a proposal to sell some or all of their stakes in the company, according to a regulatory filing published on Friday. The Reuters-Jefferies CRB index, a global commodities benchmark, fell 0.9 percent as crude and base metals suffered on lingering concerns over Europe's debt woes.
Sagging prices weighed on major exporters of raw materials such as wood pulp producer Copec in Chile, which dropped 2.5 percent. Chile's IPSA index slipped 0.4 percent after three days of gains. The index was down for a second straight weekly loss after its MACD momentum indicator signalled an end to its late August rally.
Brazil's Bovespa index was positive for the week, but struggled to break out of its recent range of 54,000 to 58,000 points, marking lower highs through the month in a sign of flagging momentum. Peru's IGRA index rose 0.72 percent to 20,573.07, it's highest close in two weeks. Mexican markets were closed for a holiday.