Mexico's Stocks, Peso Fall in Reaction to Greek Woes

   By Anthony Harrup

        MEXICO CITY--Mexico's stocks fell sharply Monday, and the peso lost ground against the U.S. dollar as investors concerned about fallout from the Greek debacle shunned risky assets, hitting global markets.

        The IPC index of leading issues closed down 1.9% at 44,710 points on volume of 197.5 million shares worth 5.73 billion pesos ($365 million).

        The peso weakened against the U.S. dollar, and was quoted closing in Mexico City at MXN15.6950, according to Infosel, compared with MXN15.5450 at the close Friday.

        Mexican Finance Minister Luis Videgaray said authorities were keeping a close watch on the reaction in local markets to the events surrounding Greece.

        "Stock markets across the world are clearly being affected by the events in Greece, currency markets too, particularly in emerging markets... In Mexico we will continue doing what we have said we would, which is to make sure that markets operate orderly and with liquidity," he told reporters at an event. "We're seeing a certain depreciation of the peso against the dollar, but debt markets and the stock exchange are operating in order."

        In the currency market, the Bank of Mexico sells $52 million each day from reserves to complement liquidity, and auctions $200 million on days when the peso depreciates 1.5% from the previous session's fixing.

        The peso stopped short of reaching the level of MXN15.8011 to the dollar, which would have triggered sales at the $200 million auction. The central bank placed the $52 million at an average price of MXN15.6481 per dollar.

        Yields fell on Mexican government bonds, which are more sensitive to U.S. interest rates than to other causes of volatility. The yield on bonds due 2024 fell six basis points to 6.08%, and the yield on 20-year bonds due 2034 fell eight basis points to 6.70%. Yields on fixed-rate bonds fall when prices rise.

        Write to Anthony Harrup at anthony.harrup@wsj.com

        (END) Dow Jones Newswires

        June 29, 2015 17:17 ET (21:17 GMT)

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