Vanishing Point

Sep 1, 2004

A record-setting performance by Mexican stocks has triggered a wave of IPOs, but the market is still shrinking.

Banamex, delisted in 2001
Good news has been almost exactly balanced by bad for the Bolsa Mexicana de Valores, Mexico's stock market, this year. Share prices have performed well and the market has seen its first Initial Public Offerings (IPOs) in many years, most impressively a $155 million placement in June by homebuilder Desarrolladora Homex. But tender offers from large European companies led to the delisting of two large stocks, BBVA Bancomer and Apasco, cutting heavily into trading volumes.

BBVA Bancomer is Mexico's biggest bank and Apasco is the Mexican subsidiary of Swiss-owned cement giant Holcim. Banamex, Citigroup's Mexican subsidiary and the country's second-largest bank, delisted in 2001.

The benchmark Indice de Precios y Valores (IPC) gained 12.5% in dollar terms in the through mid-August, while the Dow Jones Industrial Average fell 5%. In April, it set a new high in dollar terms for the first time in a...

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“The crisis has been a setback for reserve diversification."

Jan Dehn, Ashmore Investment Management