Rally Has Ended. Stocks Are Down in Brazil

Latin American shares moved lower amid significant losses in both Brazil and Mexico. Investors remained attentive to volatility as doubts lingered about the trajectory of monetary policy in the U.S. Argentine markets were closed today in observance of Flag Day.

Brazil’s Bovespa Index lost 501.57 points or 1.46%. Mexico’s benchmark Bolsa was down 459.91 points, or 2.55%.

Brazilian shares slid lower as investors continue to question where U.S. interest rates are headed over the next few months. Trading was also dented by an options expiry scheduled for the session.

On the economic front, the Ministry of Trade and Development said that Brazil posted a US$ 654 million foreign trade surplus in the June 12-to-18 period, bringing the trade surplus for the year to date to US$ 17.429 billion. The most recent result is slightly lower than last year’s US$ 17.895 billion.

Meanwhile, the Brazilian Census Bureau, or IBGE, reported that retail sales volume rose a seasonally adjusted 1.52% in April compared to a month prior. The most recent result was also above the average analyst estimate, as polled by the Estado news agency.

In Mexico, stocks were lower following a rally late last week that helped slow nearly a month of heavy losses. Mexican shares fell alongside declines in the U.S., a major trading partner.

The IPC, along with other emerging-market bourses, has suffered from the heavy selloff of the past month as investors priced in the likelihood of U.S. interest rates rising.

But last week the IPC pulled out a rally despite a higher-than-expected pickup in core inflation in the U.S. that reinforced expectations of a rate increase by the Federal Reserve at its next Federal Open Market Committee June 28-29 later this month.

Traders took advantage of the heavy selloff in Mexican equities in May and early June to go bargain hunting for blue chips.

Shares of Mexico’s top retailer, Wal-Mart de Mexico, were lower. A major investment bank added Walmex to its equity model portfolio, staying overweight in Mexico because of its attractive valuations.

Elsewhere, shares of cement maker Cemex were slipped. Cemex said it expects second-quarter earnings before interest, taxes, depreciation and amortization to rise 14% from a year ago.

ICA Fluor, a joint-venture of ICA and Fluor Corp., said it won a US$ 108 million contract to expand and revamp a petrochemical plant owned by a unit of conglomerate Alfa SA.

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

How Arabs Helped and Continue Shaping Brazil’s Culture and Trade

Shopping in Brazil before the late 19th century meant facing a Portuguese immigrant, almost ...

Survival Wants Brazilian Ranchers Removed from UN’s Global Compact

London-based human rights organization Survival International is calling for Brazilian cattle-ranchers involved in a ...

Brazil, India and South Africa Mean Business

Last weekend the Chancellors of Brazil, India, and South Africa, the group known as ...

US$ 1.65 Million from US to Fight Hunger and Sex Exploitation in Brazil

Strengthening the family as a means to combat hunger and the sexual exploitation of ...

Brazil’s Gay and Lesbian Federation Gets Advisory Status at UN

UN's Economic and Social Council (ECOSOC) granted consultative status to the Brazilian Federation of ...

World Wants to Know About Brazil’s Zero Hunger

On the eve of the UN conference on poverty and hunger, Brazil has prepared ...

Brazil’s Lula Complains That Rich Nations Are Not Helping Enough the Poor

During his weekly radio talk to the nation, today, Brazilian President Luiz Inácio Lula ...

US Sponsored FTAA Will Be Buried at Americas Summit, Says Chavez

Venezuelan president Hugo Chavez forecasted that the coming Americas Summit in Mar del Plata, ...

Brazil Embraer's Phenom 300

Brazil’s Embraer Reinforces Sales Team for US, Canada and Mexico

Brazilian aircraft manufacturer Embraer has increased its North America's Executive Jets sales team by ...

Rising Foreign Investment Lifts Brazilian Stocks

Brazilian investors were encouraged by a strong day on Wall Street and new economic ...