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The main index of the Mexican Stock Exchange, the S & P / BMV IPC, is shaping up to close with the best performance since 2012, by positioning itself at 51,238.02 units, with an increase of 16.27% so far this 2021, compared to to the advance seen of 17.88% nine years ago.
The increase in the BMV contrasts with the Brazilian Stock Exchange, which this year fell 10.57 percent. Even the Mexican index remains above others such as the FTSE 100, the benchmark for the London Stock Exchange, which grows 13.2%, and a level almost similar to the US Dow Jones which advances 16.8 percent.
Analysts explain that the momentum taken by the IPC is due to a correction after the strong volatility suffered last year by the pandemic, as well as a recovery in economic sectors and excess liquidity in global markets.
“In 2021 a positive behavior has been observed for the CPI in line with the Wall Street indices, due to a generalized recovery, especially in sectors that were most affected last year by the pandemic, such as consumer discretionary. Also to monetary stimuli because they have generated high liquidity in the markets. A third element is the positive quarterly reports of the companies, ”Karla Bajos, an analyst at Banco Base, explained at a conference.
For his part, Carlos Hernández, senior analyst at Masari Casa de Bolsa, considered that the rebound in the main index of the Mexican Stock Exchange (BMV) is the result of a significant correction after the volatility it registered in 2020 due to the pandemic.
“Now that the economic balance, both in the country and in the companies, have stabilized again, there is a better outlook for the index. A second element that has contributed is attractive valuations, ”he said.
If it maintains and even surpasses the current level, the S & P / BMV IPC would far exceed the end of 2020, when it grew by 1.21% or to 2019, when it rose by 4.56 percent.
The stations with the highest return so far this year are the restaurant operator Alsea (+ 45.58%); followed by Banco del Bajío (+ 39.26%); as well as by the telecommunications giant América Móvil (+ 38.58%).
The fourth and fifth best performing companies are the airline Volaris (+ 37.22%) and the Coca-Cola bottler Arca Continental (+ 36.58%).
Citibanamex analysts explain that the local stock market is in “a healthy consolidation process”, which has allowed it to regulate “overbought” levels.
The foregoing has helped “the growth margin to be attractive again, since it has regulated the risk levels by being located in the oversold zone; Furthermore, with this corrective process, the market practically covered the adjustment objective estimated in mid-October of about 50,500 points ”.
Hard to beat 2021
Specialists consider that by 2022 the probabilities that the stock market will achieve double-digit yields are low, due to inflationary pressures, due to the more restrictive policies of the main central banks and due to increases in interest rates.
The consensus of analysts consulted by the Mexican Association of Stock Market Institutions (AMIB) estimate an average rise of 7.62% for the IPC, which would reach 56,446 points by the end of next year.
Gabriela Siller, director of Economic and Financial Analysis at Banco Base explained at a conference that in 2022 it will be difficult to see returns like those of 2021 because the expansive policy of the Federal Reserve (Fed) will end and interest rates will begin to rise, which generally causes adjustments in investment portfolios.
“The probability that we will see increases of 15% in the BMV Price and Quotation Index is nil,” said the expert.
He added that inflation will also impact, which he estimates will end at levels of 8% this year, the highest since the end of 2000, while for the first quarter of 2022 it is expected to be above 7 percent.
Karla Bajos projects 53,000 points for the S & P / BMV IPC for next year because important risks will continue that will limit the gains in the Stock Market, mainly the less flexible monetary positions, as well as the uncertainty related to the economic policies in Mexico that are inhibiting investment.
If the electricity reform initiative is retaken, “investors would react and confidence would be lost even more,” he added.
Carlos Hernández projected a closing of 57,500 points for the stock index of the BMV for 2022, but it will depend on the path taken by inflation, economic recovery and interest rates.
“In the first quarter of 2022 we could see volatility in the stock market derived from monetary policy in developed countries that in one way or another impact financial assets, from the perspective of economic growth and how inflation will continue to impact,” said the Masari specialist.
judith.santiago@eleconomista.mx
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