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Assassination Impact

March 25, 1994|NANCY RIVERA BROOKS

The killing of Mexican presidential candidate Luis Donaldo Colosio has introduced some uncertainty about the future of Mexico's business and trade climate. This is the impact so far in some areas:

* Financial markets: The Mexican stock market was closed Thursday, but analysts expect a selloff when it reopens. Shares of Mexican companies traded on U.S. exchanges fell between 3% and 8%. International credit rating agencies, Moody's and Duff & Phelps, said they will not change their speculative credit ratings for Mexico's bonds.

* The currency: Mexico declared a bank holiday Thursday, so the peso did not trade. Early trading today could be touch-and-go, experts predict, but they noted that the Federal Reserve was reported to be lining up support for the peso should it be needed. Mexico also is considered to have sufficient foreign reserves to bolster its currency.

* Business investment: Some knowledgeable about foreign investment in Mexico expect some hesitation from investors still negotiating deals. But representatives of companies already in Mexico said they are proceeding with confidence. However, the new presidential candidate selected by the PRI will come under intense scrutiny, particularly concerning his views on trade and the economy.

* Tourism: Big hotels and tour operators said that travelers to Mexico were expressing some concern, but few were canceling their plans. However, Tijuana tourism officials reported a significant drop Thursday in the number of visitors who normally clog the Avenida Revolucion area of the border city. Tijuana's tourism may take several days to rebound, they said.

* Banks: Major American banks planning to open subsidiaries south of the border said the assassination would not affect their plans.

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