• Categories
  • Archives

While Waiting for Interest Cuts Bulls Have Party in Brazil

Latin American markets turned notably higher, following two consecutive down days in Brazil and Mexico, partly due to profit-taking.

Today, bargain hunters moved in to pick up the beaten down shares. Brazilian investors are awaiting next week’s interest rate meeting, while Mexican investors cheered today’s 50-point basis cut in the overnight rate.

Brazil’s benchmark Bovespa Index rallied 441.72 points, or 1.36%, while Mexico’s benchmark Bolsa Index surged 343.46 points, or 2.00%. Argentina’s Merval Index rose 9.75 points, or 0.64%.

Brazilian shares bounced back from recent weakness, and thanks to a steep decline in crude oil prices, which tends to pressure the net importer of the commodity. Investors are looking forward to next Wednesday’s central bank meeting in which an interest-rate cut is expected.

In today’s economic reports, the IBGE census bureau said that the official IPCA consumer price inflation rate slowed to 0.55% in November from 0.75% in October, in line with analyst expectations.

The most recent result pulled the 12-month rolling IPCA inflation rate to 6.22%, compared with 6.36% the 12 months through October. Meanwhile, inflation from January through November reached 5.31%.

CVRD advanced, after the mining firm said it completed its takeover of Canada’s Canico Resource. On a down note, state-run oil firm Petrobras receded, after the firm’s transportation unit, Transpetro, extended a December 15 deadline by two weeks to receive proposals of companies pre-qualified for a tender to build 26 oil-industry support vessels.

Within the telecom group, wireless operator Claro, the local unit of Mexico’s America Movil, will resume operations in Minas Gerais, after a local court overturned an injunction that forced the firm to stop operations. Rival Telemig Celular argued a conflict of interest.

In Mexico, shares reached a fresh record high close. The central bank announced a 50-basis-point cut in the overnight rate, which will allow it to fall as far as 8.25%. The corto will remain at 79 million pesos. Most analysts were expecting a smaller 25-point easing.

Meanwhile, the Finance Ministry reported a US$ 637 million trade deficit in October, widening from the previously reported US$ 631 million gap. Lower petroleum exports than previously recorded was blamed for the revision.

In corporate news, America Movil surged, after a major investment bank reiterated the firm as its top wireless pick for Latin America.

Argentine investors came back from yesterday’s Immaculate Conception holiday in a buying mood. Gains were modest, as volume was low.

In economic reports, the national statistics agency said that the jobless rate fell to 11.1% in the third quarter from 12.1% in the second quarter, in line with preliminary data released a few weeks ago.

Thomson Financial Corporate Group – www.thomsonfinancial.com

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

William Faulkner

Faulkner in Brazil: An Important But Neglected Presence (Part II)

What Hosam Abou-Ela (2005) calls the "poetics of peripheralization" is described as "the relationship ...

Bullish News in Brazil Despite Market Closure

Latin American shares advanced, despite a market closure in Brazil. Mexican equities rallied alongside ...

World Social Forum Leaves Brazil

The World Social Forum took place in Porto Alegre, in the south of Brazil, ...

‘Be Patient,’ Lula Asks Brazil

"The art of government is the art of patience. We do not have the ...

Brazil: Journalist Wants Dictatorship Abuses Reinvestigated

Brazilian journalist Rose Nogueira, president of the group Tortura Nunca Mais (Torture Never Again). ...

Turn In Your Weapons in the Name of God!

People going to Brazilian churches these days have the opportunity not only to free ...

The naturism fad

No Shame As Adam and Eve in Paradise, many Brazilians are opting for the ...

Banco do Brasil Adopts Experian’s Experience to Check Clients’ Credit

Experian-Scorex has announced that Banco do Brasil is going to implement its Probe SM ...

Profit Taking Drags Brazil’s Bovespa Down

Latin American stocks were mixed, with Brazilian stocks pulling back, as investors opted to ...

Brazil Renews Its Commitment to South America and Mercosur

The Brazilian Minister of Foreign Relations, Celso Amorim, declared that the way to strengthen ...