Mexico Stock Index Drops After New Regulations

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Mexico Stock Index Drops After New Regulations

Mexico's Stock Index Drops 4% After New Regulations For Airport Operators

The major stock index of Mexico lost 4% of its value during Thursday's trading session. Most of this drop was driven by a change in the tariff regulation for airport operators.

Airport operator OMA stock actually sank by 40%, while the Asur & GAP lost 28% and 33% of their value in a single trading day. All of this is happening because the Civil Aviation Authority of Mexico made some changes that affect all of these companies.

OMA, Asur, And GAP Are Down

After the sharp decline in all of these stocks, the trading was momentarily suspended in an attempt to cool down the market. However, the decline was enough to send the S&P (Mexico) index down for the day with a -4% change. If the current bearish trend in Mexican stocks continues, it will be one of the worst days in almost 3 years.

According to the airport operators, they are looking at how the changes will impact their day-to-day operations. However, it is important to note that the change will take effect immediately.

According to one expert who specializes in Mexico's market, the changes by Mexico's civil aviation authority are not good for the overall sector.

Under the new changes, the TUA will be reduced along with a reduction of the income from non-aeronautical sources. All of these factors will harm the profitability of the airport operators. At the same time, it will also lead to potential financial problems for these firms as well.

As for the recent price-action in these stocks, the experts believe that caution is needed for the short term until some stabilization takes place.

On the surface, it is clear that airport operators will be earning less money under the new regulations. Now, it remains to be seen whether Mexico's authorities will take back the new plan or stick with it for good.

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