By Anthony Harrup
MEXICO CITY--Mexican stocks rose Tuesday to their highest close in almost a year as local investors returned from a long weekend, while a rebound in oil prices lifted the peso against the U.S. dollar.
The IPC index of most-traded stocks rose 0.3% to 45,632 points, its highest close since late April 2015.
Shares of cement and building materials company Cemex rose 4% to MXN12.44, adding to last week's hefty gains when company executives reaffirmed their commitment to improving the company's debt profile and raised their target for free-cash-flow generation this year. Credit Suisse upgraded the stock Monday.
Telecommunications company America Movil shares closed up 1.2% at MXN13.16.
The peso recovered from early losses along with oil prices. The currency was quoted in Mexico City at 17.3385 to the U.S. dollar, compared with MXN17.3940 at the close Friday. Mexican markets were closed Monday for the Benito Juarez holiday and will be closed Thursday and Friday for Easter.
In local economic news, the National Statistics Institute reported a smaller-than-expected 0.1% rise in consumer prices for the first half of March, although core prices, which exclude energy and much fresh produce, rose more than anticipated.
Tourism services and airfares ahead of the Easter holidays contributed to the 0.3% core reading, while the weaker peso continued to affect prices of some durable goods.
"Although the inflation outlook is still somewhat comfortable, the large MXN depreciation in recent months added visible upside risk to the inflation outlook despite still-sluggish real activity dynamics and evidence of just moderate pass-through," Goldman Sachs said in a note.
The Bank of Mexico is likely to continue watching for evidence of the exchange-rate effect spilling into other prices, which could prompt further interest-rate increases, Goldman Sachs added.
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