• Categories
  • Archives

Inflation Up North Gives Brazilian Stocks the Chills

Latin American and Brazilian shares in particular were down on continued worries about U.S. inflation and interest rates. Brazilian markets closed early for Brazil’s World Cup match against Croatia, which ended with an 1 to 0 advantage for Brazil and will be closed Thursday for the Corpus Christi holiday.

Brazil’s Bovespa Index plunged 706.91 points, or 2.11%. Mexico’s benchmark Bolsa index fell 333.12 points, or 1.96%, while Argentina’s Merval Index lost 14.91 points, or 0.99%.

Brazilian shares were down on higher May U.S. producer price index data that could lead to a continuation of the U.S. monetary tightening cycle currently draining funds from emerging markets. U.S. producer prices, a closely watched measure of wholesale inflation, rose 0.2% in May, while core prices, which exclude food and energy, rose 0.3%.

Meanwhile, Brazilian inflation is also rearing its head. The Getúlio Vargas Foundation IGP-M index showed four-week inflation of 0.27% through early June, up from 0.21% for the period through early May. The combination of domestic inflation and emerging market worries could cause the Brazilian Central Bank to halt its recent policy of monetary loosening.

Elsewhere, Mexican stocks also closed lower for the seventh consecutive session, spurred by investors pulling money out of emerging markets. Concerns persist that rising interest rates around the world will hinder market liquidity. Meanwhile, investors are also awaiting the presidential election in Mexico, scheduled to take place on July 2.

In economic headlines, Mexico’s April industrial production slipped versus the year-ago month as the Easter holiday lowered the number of working days. Production fell 0.8% from April 2005, below the median estimate of a 2.3% increase in a Dow Jones Newswires survey of economists.

In non-annualized, seasonally adjusted terms, output was up by 1.74% versus March. Industrial production for the first four months of the year was up 5% versus the year-ago period.

Argentine issues dropped today as well. Trading was volatile, as market titan Ternaries rallied, which helped ease broader market losses. Ternaries jumped on word it intends to buy U.S.-based Maverick Tube for about US $3.19 billion in cash.

Thomson Financial – 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Your email address will not be published.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

Brazilian Government to Get More Involved in Big Construction Projects

The new Brazilian president Dilma Rousseff has decided that in the case of large ...

The Beast in on the Loose in Brazil’s Backlands

The beast was bored. The very-strong sun was hitting his head and leaving him ...

Part II: Richard Boukas talks about life, music, and the lure of the Brazilian.

Surveying the panorama, I saw mile after mile of developed beaches fronted by high-rise ...

Brazilian Sheep Herders Get Mobile Insemination Lab

Small and medium-scale goat and sheep herders in 12 municipalities in the Northeastern Brazilian ...

Brazil Will Become a World Power Despite the Big Powers, Says Lula

Brazilian President Luiz Inácio Lula da Silva reaffirmed that one of his government’s priorities ...

World’s Largest Collection of Tropical Snakes Turns into Ashes in Brazil

Over 82,000 snake specimens, a collection considered the largest one of tropical serpents in ...

Brazil and Argentina Create Unified Front Against the IMF

The presidents of Brazil, Luiz Inácio Lula da Silva, and Argentina, Nestor Kirchner, signed, ...

American Suspect of Child Porn and Pedophilia Murdered with 7 Shots in Brazil

Brazil's police are investigating the murder of American Gerald Gusta Cisco, 61, in Natal, ...

Old Age and Pension in Brazil and Other Countries

Anne O. Krueger, First Deputy Managing Director of the International Monetary Fund speaks at ...