• Categories
  • Archives

Brazil Market Down Under Clouded Political Skies

Latin American shares, much like their U.S. counterparts, gave up early gains and turned negative, yesterday. Ongoing political tensions in Brazil continued to cloud that market.

Meanwhile, after an early rise in U.S. markets due to upbeat guidance from Texas Instruments, stocks receded. The White House trimmed its 2005 gross domestic product growth estimate to 3.4% from 3.5% and raised its outlook for inflation acceleration to 2.9% from 2%.


Investors are also awaiting Federal Reserve Chairman Alan Greenspan’s congressional testimony regarding the U.S. economy, which is scheduled for today.


Brazil’s benchmark Bovespa Index gave up 324.60 points, or 1.30%, while Mexico’s benchmark Bolsa Index tumbled 45.37 points, or 0.35%. Argentina’s Merval Index slipped 1.01 points, or 0.07%.


Brazilian shares returned gains acquired early on in the session. Investors had few domestic corporate or economic reports to divert their attention from the ongoing political scandals.


The firing of two top officials at the Post Office and Reinsurance Institute by President Luiz Inácio Lula da Silva led some market watchers to believe that the corruption charges were being taken very seriously.


Also, Brazil’s congress is set to open an investigation into alleged corruption at the Post Office and other state-run firms this Thursday.


Mexican stocks also receded after an early rebound. Shares took some of their cue from U.S. market weakness.


In economic reports, the Finance Ministry announced that fixed investment grew 6.5% during the first quarter of 2005, compared to the corresponding quarter a year earlier. Higher investment in equipment and machinery positively impacted the bottom line. Investment rose 2.3% in March, versus a year ago.


Elsewhere, the Mexican Auto Industry Association said that auto production rose 5.6% in May, compared to the corresponding period a year ago, to 131,295 units. Exports increased 5.3% last month, while domestic sales rose 1.8%.


Amid brokerage reports, a major investment bank upgraded three Mexican soft-drink bottlers due to expectations for lower plastic bottle prices, which could boost the firms’ profit margins. The broker lifted its ratings on Coca-Cola Femsa, Contal and Arca to “buy” from “neutral.”


Argentine issues ended virtually flat, as there were few news items to spur meaningful trading activity. Spanish-Argentine energy firm Repsol-YPF confirmed that Bolivian protestors took control of three more small oil fields. The protestors are demanding the nationalization of Bolivia’s oil and gas industry.


Meanwhile, Argentina’s Ministry of Labor temporarily halted strikes by members of the national mechanics union at three major auto producers’ plants. Both sides will attempt to reach wage agreements by Monday.


Thomson Financial Corporate Group – www.thomsonfinancial.com


PRNewswire

Tags:

  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

Brazilian Companies Go Looking for Foreign Partners

The National Confederation of Industries (CNI) is investing in services at its International Business ...

Brazil: Venezuela’s Oil Financed Rio’s Carnaval Champ

The Vila Isabel samba group, backed by Venezuelan oil money, was declared Carnaval champion ...

Brazil’s Petrobras to Invest US$ 1.5 Billion in the US

As part of the consolidation of its presence in petroleum exploration and production in ...

Brasília Celebrates 50th Birthday Under Cloud of Scandal

Rogério Rosso, from the PMDB party, who served Brazil Federal District’s administration as the ...

Rio Intermezzo

Everyone had warned me about Rio. That’s why I had to go there. The ...

Brazil’s Lula in Venezuela Campaigning for Chavez Reelection

Brazil’s newly re-elected leader visited Venezuela on Monday in a show of support for ...

Best-seller books, plays & movies

PLAYS Alô? Madame!… — It all starts when two friends get a phone number ...

Brazil Spends US$ 5 million to Make Its Movies World Hits

The Brazilian government will make investments in the exportation of films, TV programs and ...

Your typical DC Beltway traffic jam in the US

A View from Brazil: We’re All Pyromaniac Neros and Bush Is a Bigger One

Some 2000 years ago, a Roman emperor with artistic inclinations was accused of burning ...