|
Brazilian and Latin American stocks tumbled, dragged down by concerns that higher U.S. interest rates will pull more foreign investors away from the region's assets.
Today, the U.S. Federal Reserve hiked interest rates by 25 basis points and made some more cautious comments on the prospects for inflationary pressures, which it is feared could result in more aggressive rate increases.
Brazil's benchmark Bovespa Index tumbled 793.28 points, or 2.89%, while Mexico' s benchmark Bolsa Index lost 31.95 points, or 0.24%. Argentina's Merval Index slumped 20.83 points, or 1.47%.
Brazilian shares dropped, giving up earlier gains, as the market reacted negatively to the U.S. interest rate increase.
The market had earlier brushed off news that the General Price Index rose 0.55% in the 10 days through March 20, up from 22% for the same period of February, according to the Getúlio Vargas Foundation.
The result was in line with market forecasts, with an accelerating wholesale component pulling the overall index higher.
In corporate news, iron ore miner CVRD was active after posting record results for the fourth quarter. Some analysts were a bit disappointed in the numbers, but remain optimistic on the stock.
One brokerage firm said that the relevance is "modest given the huge impact from the upcoming 71.5% iron ore price hike and the bullish company guidance/outlook."
Also, AmBev announced that it will begin selling its flagship Brahma brand in nine new European and North American markets this April, and then expand distribution to several more international markets by the end of the year. AmBev is attempting to turn Brahma into a global beer brand.
Mexican equities also moved lower, reversing earlier gains, as declines in the U.S. market weighed on sentiment. The market was closed yesterday for a holiday and will be closed Thursday and Friday, sapping volume from the trading session.
In economic news, consumer prices for the first half of March rose 0.20%, just shy of forecasts for a 0.21% increase. The data was also little changed from a year earlier when consumer prices were up 0.18%. The recent data keeps annual inflation steady at about 4.3%.
Also, January retail sales were up 6.2% from a year earlier, and climbed 1.62% from December in seasonally-adjusted terms. The year-on-year increase was in line with forecasts. January marked the 25th straight month of year-on- year gains.
Looking at corporate developments, Telmex announced that it has increased its stake in Brazil's largest pay television firm, Net Serviços de Comunicação.
Telmex now owns a 36.6% direct stake in the company's voting shares, and a 19.6% stake in total capital, as Telmex looks to expand its presence in the Brazilian telecom market.
Out of Argentina, the market continued to weaken, as investors remain wary of the equities, after their recent surge. Investors now want the government to take steps to address other economic and political issues.
On the economic front, the current account surplus for the fourth quarter reached US$ 484 million because of strong export-related inflows.
A pick up in imported goods and services and higher dividend payments offshore helped narrow the surplus from last year's US$ 1.079 billion. The 2004 current account surplus was US$ 3.029 billion.
Also, final February industrial production rose a seasonally adjusted 4.9% year-on-year. The February number was down 0.7% from January, however.
The results were unchanged from the preliminary figures reported last week. Economists had expected a stronger gain for the month.
Looking at the bank group, Grupo Financiero Galicia said late yesterday its main asset, Banco de Galicia y Buenos Aires, was considering a 1 billion peso bond program. It would mark the bank's first time in the capital markets since it completed its 2004 debt restructuring.
Thomson Financial Corporate Group
http://www.thomsonfinancial.com
PRNewswire
 |
Subscribe to this comment's feed
The small, coastal town of Condé is located just a twenty minute's drive from João Pessoa, the capital of Paraíba. The Northeast of Brazil has historically been a place of encounter and mixing between peoples. For millenia groups of indigenous people fished, farmed, migrated and sometimes fought along this large, fertile area. 
The Brazilian diplo-MÁ-cia (bad diplomacy) carries on its accelerated course towards the non-acknowledgment of human rights, although sometimes it takes pleasure in saying that it does precisely the opposite. The visit of Iran's president, Mahmoud Ahmadinejad, is another example of a diplomatic omission that verges on hypocrisy. 
On July 4, 2006, representatives of Argentina, Brazil, Paraguay and Uruguay met in Caracas to sign the protocol for the entrance of Venezuela into the Southern Common Market (Mercosur). After two and a half years, the protocol was approved by the legislative bodies of Argentina and Uruguay, and as of now it may be only days away from being ratified by the continent's economic megalith, Brazil. 
Some sectors of the fight against AIDS have suggested that Thabo Mbeki, the former president of South Africa, committed genocide through his absence from the fight against the illness in his country throughout his two terms. 
One hundred and eleven years after Brazil abolished slavery, the number of workers deprived of their freedom is still huge. They raise cattle, produce charcoal, sugar cane or timber. Some of them, most undocumented Bolivians, work in basements of small apparel factories in São Paulo and other metropolis. 
On November 7, 2009 a few friends and I had an opportunity to take a look inside a Brazilian jail outside the city of Rio de Janeiro. We were able to take some amateur footage of our experience on video (see link below). It's no surprise, of course, that the typical Brazilian jail lacks some of the functionality of those in North America or Europe, but our experience that day was quite shocking. 
Depletion of the Amazon Rainforest is not a new concern facing environmentalists, biologists, ecologists, and a growing number of the Amazonian indigenous peoples. For decades they have feared for the fate of the world's most biologically diverse and species-rich hothouse. 
Geisy Arruda made history this week in Brazil, but for all the wrong reasons. What began as a poorly planned fashion statement has become a worldwide tale. Geisy decided to wear a pink mini-dress to her private college in São Paulo state, and after that, all hell broke loose. 
The push of vigilante groups in Rio de Janeiro's favelas (shantytowns) in the last three years is the most important and alarming information of the just-released study by the Rio de Janeiro University's Violence Research Center (Nupev-Uerj). 
A dispute over drug trafficking territory in Rio de Janeiro has intensified lately, leaving in its wake unprecedented acts of violence, such as the downing of a police helicopter in the northern zone of the city on October 17. Three policemen died and another two were injured. This event has drawn the attention of the international media, who are raising the issue of public security for the 2016 Olympics to be held in Rio.