Daily Archives: June 6, 2012

The fates of the Mexican Peso and America Movil lie in the Eurozone Crisis

America Movil’s financial management and market positioning surely contribute to its stock performance, but equally important is the relationship between the Mexican peso and the U.S. dollar. Of all the major Mexican ADRs, America Movil, and the iShares Mexico ETF EWW most closely mirror the USDMXN currency pair, which a simple 5 year chart makes rather clear (Cemex and Homex are of course in far worse shape due in part to their concentration in real estate):

In addition to the clear correlation of both America Movil and EWW to the peso, the more significant takeaway from this chart is that both securities underperform peso weakness to a much greater extent than they outperform peso strength. Given this apparent reality, examining the peso’s behavior should provide some indication of what to expect for both and going forward.

Read more at Seeking Alpha.

Emerging & Frontier Markets Headlines 2012.06.06

Bank of China New York branch offering renminbi-denominated CDs — Bank of China New York branch
Colombian bond yields at four-year low — Bloomberg
Ghana Eurobond Yields at 3-Month High — Bloomberg
German Euros Becoming a Reserve Currency — ValueWalk
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