Bloomberg News

Chile’s Socovesa Jumps Most in 20 Months on Jobs Outlook

October 24, 2011

(Updates with closing prices in second paragraph.)

Oct. 24 (Bloomberg) -- Socovesa SA, Chile’s largest publicly traded home builder by sales, jumped the most in almost 20 months on speculation the country’s unemployment will fall and a global economic recovery will lift demand for new houses.

Socovesa surged 7.3 percent to 234.7 pesos at the close of trading in Santiago. Today’s gain, the ninth in 10 sessions, was the biggest since March 2, 2010.

The company’s shares are sensitive to changes in joblessness, said Alex Sadzawka, an analyst at Santiago-based Celfin Capital SA. The country’s statistics institute on Oct. 28 will probably report that unemployment declined in September, according to economists surveyed by Bloomberg.

“Anything that points to lower unemployment helps,” Sadzawka, who forecasts the shares will reach 310 pesos by the end of the year, said in a telephone interview. “Better-than- expected” economic data out of Europe and China is also lifting confidence that Chile will keep growing and demand for the company’s new homes will continue, he said.

Chile’s unemployment rate probably fell to 7.3 percent in September from 7.4 percent a month earlier, according to the media estimate of 12 economists surveyed by Bloomberg.

Global stock markets rallied today and Chinese shares gained for the first time in five sessions after a report showed the nation’s manufacturing may expand for the first time in four months. Europe’s benchmark Stoxx Europe 600 Index has rallied for four straight weeks amid speculation the region’s political leaders will find a solution to a crisis that has Greece on the edge of a default.

--Editors: Brendan Walsh, Richard Richtmyer

To contact the reporter on this story: Nathan Gill in Quito at ngill4@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at Papadopoulos@bloomberg.net


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