A Good Move That Seems To Have Been Punished

Telmex announced after the bell that it's repaying $1.3 bilion in debt earlier than the specified maturity date. The company committing to do so means that substantially all of its 2009 maturity commitments have been met.

In these times, it would seem to be a good move. The Mexican economy ain't out of the woods, and the lesson of leverage has been well rubbed in during the past year.

And yet, Telmex dropped 4.94% in after-hours trading. This drop comes on top of a 1.96% decline in regular trading.

It could be a result of selling on the good news. Telmex has been in a trading range since early April, and the stock did poke above that range recently. Perhaps this was the good news that was expected. Now announced, there's no further reason to see Telmex as attractive in the near term. Perhaps.

Still, the Telmex tale is a case study in market refractoriness (or unpredictability.)