• Categories
  • Archives

Growing Rumors of Finance Minister’s Resignation Leave Brazil Singing the Blues

Latin American stocks were mixed, with Brazilian stocks slumping amid news reports that the country’s Finance Minister will soon resign. Meanwhile, Mexican shares gained ground amid positive analyst commentary.

Brazil’s Bovespa Index dropped 292.01 points, or 0.96%. Mexico’s benchmark Bolsa Index rose 156.46 points, or 0.97%, while Argentina’s Merval Index added 2.43 points, or 0.15%.

Brazilian stocks dropped amid heightened concerns about a widening political scandal after several Brazilian newspapers reported that Finance Minister Antonio Palocci will soon resign over corruption allegations and criticism of his orthodox economic policies.

Some of the reports said the administration of Luiz Inácio Lula da Silva is searching for a replacement for Palocci, while other papers said Lula is preparing a speech to defend Palocci’s policies.

Last week, Brazil’s Chief of Staff Dilma Roussef criticized Palocci’s economic policy and said Brazil would not raise the country’s primary surplus target as aides of Palocci have suggested. However, Brazilian Trade Minister Luiz Fernando Furlan said he thinks Palocci "won’t leave" his post.

In corporate news, Banco do Brasil reported a bigger-than-expected net profit of 1.438 billion reais for the third quarter, up 72.7% from 833 million reais a year earlier.

Shares of power utility Light rose following press reports that an investment fund to be created by construction firm Andrade Gutierrez may purchase the company from France’s EDF.

Petrobras was active after the oil giant said it expects to produce more than 100,000 barrels of oil a day from two Nigerian fields, and that it won’t need to issue new debt in 2006 thanks to better-than-expected cash generation this year.

Meatpacker Perdigão S.A. said late Friday that its third-quarter profit more than doubled to 96.6 million reais from 40.3 million a year ago.

Aircraft maker Embraer said late Friday that its third-quarter net profit tumbled to 89.3 million reais from 396.9 million reais last year, missing analyst forecasts of 257 million reais. The company added that the real’s strength will hurt profit margins in the fourth quarter just as it did in the third quarter.

Elsewhere, Mexican shares climbed to another record high. Lending support, an influential investment bank said it remains cautiously optimistic on Mexican equities. "Investors will likely focus on earnings and keep their positions as long as the companies continue to deliver," the bank said, adding that it favors America Movil’s stock as well as shares of retailers, wireless, media and homebuilders.

In other developments, Bank of Mexico Governor Guillermo Ortiz said he still expects inflation to rebound around the end of the year. He reiterated the central bank’s year-end forecast of 3.5% annual inflation.

Meanwhile, Argentine issues edged up amid a dearth of fresh market news, as the earnings season drew to a close last week.

Helping to buoy the Merval, a consumer confidence index released by Torcuato di Tella University rose 6.5% in November from October, marking the largest monthly gain since January.

Thomson Financial Corporate Group – www.thomsonfinancial.com

Tags:

  • Show Comments (1)

  • Guest

    videopoker

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

Brazil’s Lula Calls Blair: ‘How About a Summit to Rescue the WTO Deal?’

Brazil President Luiz Inácio Lula da Silva called British Prime Minister, Tony Blair, today, ...

Brazil and Arabs Can’t Bridge the Petrochemical Trade Gulf

Free trade agreement negotiations between the Mercosur and the Gulf Cooperation Council were the ...

Too Personal

During the Porto Alegre World Social Forum, Hollywood star Danny Glover reacted with the ...

All the Sounds of City of God

The soundtrack of City of God is a treat. It brings a concise mini-history ...

Police in Brazil Search for Links Between Ruling Party PT and Organized Crime

Brazilian police are looking into the possible existence of links between the ruling Workers ...

How Brazilians Learned How to Put the Sweet in Melon

Yellow tones are part of the landscape of the Northeast of Brazil, a sunny ...

Press Freedom to Be Monitored Online in Brazil

The “Press Freedom Network”, an online tool to monitor and denounce press freedom violations ...

Brazil Buys Ambev Stocks Betting Brazilians Will Drink More

Brazilian stocks rose this December 28 adding to previous day’s already record highs on ...

Best-seller Books, Plays and Movies

By Brazzil Magazine Coração Brasileiro (Brazilian Heart)—The story of four friends who keep their ...

Brazil Just Set a New Record of Energy Consumption

Brazil’s National Electricity System Operator (ONS) reported a new record of consumption this past ...