Low Inflation in the US Gives Brazilian Stocks a Boost

Latin American stocks were mixed to higher, with Brazilian and Mexican shares climbing on reassuring U.S. inflation data. On the down side, Argentine issues extended recent losses.

Brazil’s Bovespa Index added 144.99 points, or 0.37%. Mexico’s benchmark Bolsa Index rose 128.93 points, or 0.62%, while Argentina’s Merval Index lost 7.75 points, or 0.44%.

Brazilian stocks edged up, as tame U.S. producer price data helped to ease worries about rising U.S. inflation and interest rates. The core producer price index rose just 0.1% in April, suggesting that surging energy costs have yet to feed into generalized inflation.

In local corporate news, mining giant Vale do Rio Doce announced a 19% price hike for iron ore sold to German steel maker ThyssenKrupp. Analysts had expected a slightly higher price increase, leading some to reassess their 2006 and 2007 earnings forecasts for the company.

São Paulo state waterworks utility Companhia de Saneamento Básico do Estado de São Paulo SA (Sabesp) reported a first-quarter net profit of 327.9 million reais, up sharply from 151.4 million reais a year earlier, as results were helped by an increase in tariffs.

Also reporting, electric power utility Companhia Paranaense de Energia SA (Copel) said its first-quarter net profit surged to 171 million reais from the 78 million reais a year ago on a 14% rise in revenue.

Elsewhere, Mexican shares gained ground, snapping a four-session losing streak, as investors were cheered by today’s benign U.S. inflation data and recent signs of strength in the Mexican economy. Data released yesterday showed a 9.7% rise in Mexico’s industrial production in March.

Argentine issues fell, extending recent losses, in a quiet news day for the market. Among the headlines, flagship carrier Aerolineas Argentinas and its pilots and mechanics unions agreed to a 19% pay hike, ending a long-running labor dispute. As part of the deal, workers will not resume wage negotiations until January of next year and will maintain a truce until March 2007.

Thomson Financial – www.thomsonfinancial.com

Tags:

Ads

You May Also Like

Brazil Newspapers Ban Google News. Their Message: Pay Up or Go Away

Newspapers accounting for 90% of the circulation in Brazil have abandoned Google News. Brazil’s ...

Four Out of 10 Have No Tap Water in Brazil

The technical director of Brazil’s Association of State Sewage Companies (Aesbe), Marcos Tadeu Abicalil, informed ...

Brazil Industry Slows Down and Businessmen Ask for Less Knee-Jerk Reaction

In Brazil, industrial activity finally slowed down in June. On the National Industrial Confederation ...

Google, Hottest Internet Property in Brazil with 27 Million Visitors a Month

Brazil access to the Internet is growing in a fast pace. New numbers from ...

Brazil Condemns London Terror Attack and Sends Condolence Message

Brazil’s Planalto Palace press office released the contents of a condolence message sent by ...

Brazil and globalization

In the Globalization Going on in LatAm, Brazil Is Last in Line

Despite growing populism and political tensions, Latin America is becoming more globalized, according to ...

Canceling Brazil and LatAm’s Debts Is No Charity, But an Act of Fairness

At the beginning of July, the G8 nations set forth a precedent-setting “100 percent” ...

Maria Rubinstein & her Brazil-California Chamber or Commerce

She seems to have it made now. But for Maria Rubinstein, founder of the ...

Brazil’s Capital Brasília Getting Face Lift to Celebrate Its 50th Birthday

Brasília, the capital of Brazil, will be 50 years old on April 21st and ...

Banana Republics No More

Hasn’t the time come for serious new initiatives to ameliorate past suspicions and foster ...