Bargain Hunters Reverse Brazil’s Stock Market Slump

Brazilian stocks rocketed higher, as investors went bargain hunting following a recent sell-off on concerns about rising U.S. inflation and interest rates.

Brazilian shares were further boosted by upbeat local economic data, while indications of U.S. economic strength lent additional support to Mexican issues. Argentina’s market was closed for a national holiday.

Brazil’s Bovespa Index rallied 1776.70 points, or 4.96%. Mexico’s benchmark Bolsa Index leapt 600.14 points, or 3.19%.

Brazilian stocks rocketed higher, as investors snapped up recently beaten down shares while cheering signs of strength in the local economy.

Brazil’s central bank said today, May 25, that the government posted a record primary budget surplus in April of 19.43 billion reais, up from 13.19 billion reais in March.

Also, the Brazilian Census Bureau (IBGE) reported today that Brazil’s official jobless rate in April was unchanged from March’s rate of 10.4%. Economists had expected a rate between 10.0% and 10.6%.

In corporate news, long-distance telephone carrier Embratel Participações SA was in focus following news that the company’s parent, Telefonos de Mexico SA, will maintain its cash tender offer for outstanding shares until June 7.

Meanwhile, a major investment bank upgraded shares in electric power firm Eletrobrás to "Neutral 2" from "Reduce 2," citing a more favorable valuation.

Elsewhere, Mexican shares jumped, as investors went in search of bargains following a six-day losing streak on concerns about rising U.S. interest rates.

Signs of strength in the economy of Mexico’s biggest trading partner also lent support to the bolsa. The U.S. Commerce Department reported today that U.S. gross domestic product grew at a 5.3% annual rate in the first quarter, up from an initial estimate of 4.8%.

Thomson Financial – www.thomsonfinancial.com

Tags:

You May Also Like

Brazilian Fashion Gets California Touch for Next Summer

Brazilian stylist Faissal Makhoul is hoping for a hot summer in 2009. To create ...

Guatemala Gets Lessons on Zero Hunger from Brazil

Representatives from Guatemala arrived in Brazil today to become acquainted with the Zero Hunger ...

Brazil’s Chancellor Busy in Europe Dealing with World Trade

Brazilian Minister of Foreign Relations, Celso Amorim, lead the G-20 ministerial meeting Wednesday, November ...

Progress Should Spare Brazil’s Severinos

In front of the luxury hotels on Porto de Galinhas beach in southern Pernambuco ...

Don’t Blame Brazil for the World’s Food Crisis!

U.S.-Brazil tension, a relatively recent development, resurfaced during the UN World Food Summit in ...

Brazil’s Key Interest Rate Drops 0.50%. Still High at 15.75%.

Brazil’s Monetary Policy Committee (Copom) announced yesterday, May 31, that it had unanimously decided ...

Rio’s Holiest View

Faced with the PT’s fine standing after the first round the international press may ...

A Portrait in Contrast

A new United Nations study shows that it is enough for someone to leave ...

Fed Up with Brazil and Brazilians Google May Close or Block Orkut

Brazilians make up 65% of Orkut’s 26.5 million subscribers. As some people know Orkut ...

Brazil: One Week Before Elections Rousseff is 10 Points Ahead in Presidency Race

Dilma Rousseff the woman handpicked by Brazilian president Luiz Inácio Lula da Silva to ...