Today the U.S. House of Representatives rejected the proposed subprime bailout plan by 228 to 205 votes, sending global stock markets plunging. The Dow Jones Industrial Average experienced a loss of over 750 points, the largest single-day decline in the market's history (though not in percentage terms). Outside the US, global markets experienced similar declines. Mexico's IPC index fell 6% to under 24,000. Reuters reports that all but two of the 35 stocks in the IPC index experienced large declines. The notable losers were cell company America Movil AMXL.N (AMX.N: Quote, Profile), Cemex (CMXCPO.MX: Quote, Profile) (CX.N: Quote, Profile), and copper miner Grupo Mexico (GMEXICOB.MX: Quote, Profile).
Fortunately, it appears that Mexican banks largely avoided subprime mortgages . However, the global nature of the crisis has temporarily set Mexico's market back and will surely raise the cost of capital.
