Latin American Stocks Climb; S&P 500 Sees Best Week Since January

Colombia’s Colcap index led the gains in the region on Friday, while the NYSE closed higher as investors’ fears of rate hikes above already expected levels recede

The New York Stock Exchange: Photographer: Michael Nagle/Bloomberg
By Bloomberg Línea
March 03, 2023 | 09:31 PM

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¡A roundup of Friday’s stock market results from across the Americas

👑 Colombia heads LatAm market gains:

Latin American stock markets closed in the green on Friday, following the good mood of the U.S. markets. Colombia’s Colcap (COLCAP) was the highest gainer among its peers in the region. The Colcap closed the session up 2.14%, driven by the good performance of the utilities, finance and energy sectors.

The precautionary measure decreed by the Council of State in which the decree that gave Gustavo Petro, President of the Republic, the powers to decide utility tariffs in the country was suspended, triggered today the appreciation of the electric companies listed in the Colombian Stock Exchange.

When he announced that he would take regulatory control of public utilities in the country, the effect was the opposite. The companies of the electricity sector in the country lost ground in the stock market.


Now, with the blockade of President Petro’s plans, the three representatives of the energy sector on the BVC rose strongly. Grupo Energía Bogotá (GEB), where the capital district is the main shareholder; Celsia SA (CELSIA), which owns Celsia CETSA and EPSA; and Interconexión Eléctrica (ISA), the energy transmission company that is part of the Ecopetrol Group, drove the Colcap’s gains on Friday.

🗽On Wall Street:

US stocks ended the week on a high note, driven by speculation that the Federal Reserve won’t raise interest rates beyond peak levels already priced in.

A rally in the S&P 500 Friday helped snap a three-week losing streak. The Nasdaq 100 scored its best day since early February. Sentiment remained upbeat despite a report showing resilience in the service sector, as some investors wagered the impact of the Fed’s hikes on the economy would be delayed. A measure of prices paid by service providers showed costs rising at a slower pace, which was cheered by traders.


The S&P 500 climbed 1.61%, the Nasdaq Composite (CCMPDL) 1.97% and the Dow Jones Industrial Average 1.17%.

Bond yields rose for the week though Treasuries rallied on Friday, with the 10-year yield hovering around 3.96%. A benchmark of the dollar had its worst week since mid-January, ending four consecutive weeks of gains.

All eyes will be on the non-farm payrolls report next week for clues on whether the economy can handle more rate hikes. Data this week showed continued labor-market resilience in the US, supporting the case for the Fed to stick to its tightening policy, a theme that had pushed almost every major asset into the red in February.

But investors were heartened after Atlanta Fed’s Raphael Bostic said on Thursday that the central bank could possibly pause its rate hikes sometime this summer. Traders interpreted his comments as dovish, even though Bostic and his colleagues said decisions would continue to be data dependent and a Fed report on Friday emphasized that further rate increases are in store.


Traders are still optimistic because even the most hawkish Fed officials haven’t suggested that rates could need to go beyond levels already baked in, said Priya Misra, global head of rates strategy at TD Securities. Swap markets have been pricing a peak Fed policy rate of 5.5% in September.

“I think they stay at 5.5% and we have to see how data evolves in the second quarter,” she said on Bloomberg Television.

Misra also added that robust data doesn’t mean the Fed’s persistent tightening isn’t working.


“It takes a long time,” she said. “Policy only turned restrictive last year.”

The Bloomberg Dollar Spot Index fell 0.5%, the euro rose 0.3% to $1.0634, the British pound rose 0.8% to $1.2041 and the Japanese yen rose 0.7% to 135.85 per dollar.

🍝For the dinner table debate:

Grocery prices have fallen again globally, extending their decline to a 17-month low. However, this has yet to be reflected on supermarket shelves.

The UN agency FAO’s indicator of the cost of food commodities fell by 0.6% in February, the 11th consecutive month of declines, the longest run of declines in the data in 30 years.


Last month’s decline was mostly due to cooking oils and dairy. The overall index is down 19% from its peak 12 months ago, when the fallout from Russia’s invasion of Ukraine disrupted grain exports.

Twelve months after the outbreak of the war, the price of wheat has been driven down by bumper harvests in several producing countries, such as Russia and Australia, while vegetable oil and meat prices are falling. However, this will take time to reach store shelves, where prices also remain high as a result of energy, labor and transport costs.

Leidys Becerra, a content producer at Bloomberg Línea, and Denitsa Tsekova and Alice Atkins of Bloomberg News, contributed to this report.