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Brazil Reassured That Finance Minister Won't Fall |
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Written by Paul Davee
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Wednesday, 07 December 2005 |
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Latin American markets sank, with Brazilian and Mexican shares falling on profit taking following recent strong gains. Meanwhile, Argentine shares fell amid continued worries about local inflation.
Brazil's benchmark Bovespa Index dropped 466.33 points, or 1.40%, while Mexico's benchmark Bolsa Index fell 180.24 points, or 1.03%. Argentina's Merval Index tumbled 33.14 points, or 2.13%.
Brazilian stocks dropped, as investors took profits, while digesting lackluster industrial production data. The Brazilian Census Bureau reported today that industrial output rose 0.1% in October from September and climbed 0.4% from a year earlier, as sky-high interest rates continued to restrain economic activity.
In other developments, Brazilian President Luiz Inácio Lula da Silva defended the central bank's current policy of gradually lowering interest rates.
"The Selic (base interest) rate during my administration has been, on average, lower than in many years. The Selic rate will ease, but it will ease at a pace that does not cause inflation," he said.
A number of business and political leaders have called on the central bank to speed up the pace of monetary easing. While the bank has been steadily easing its policy since September, rates still stand at a lofty 18.5%.
In the latest reassurance that Finance Minister Antonio Palocci does not plan to resign, Presidential Chief-of-Staff Dilma Rousseff backed Palocci' s austere economic policies and said that he would not be leaving the government.
"There is not the slightest chance Minister Palocci will leave the government," Rousseff said, according to local news reports.
On the corporate front, Petrobras confirmed it is in discussions to buy gasoline stations in Colombia, Uruguay and Paraguay. "It's part of our strategy to widen out distributing activity taking advantage of synergies in South America," said Petrobras' International Director Nestor Cervero.
Meanwhile, investor Fernando Chico said that the low-cost airline that he's financing for the Mexican market in partnership with Brazil's Gol will need approximately US$ 40 million in financing before getting off the ground.
In research, a major investment bank initiated coverage of Brazilian bank Nossa Caixa with an "equal weight" rating. "A good solid story, but we would wait for better entry point," the investment bank said.
Meanwhile, another investment bank started Nossa Caixa at "Buy 2." "The bank is an attractive vehicle for gaining exposure to the banking sector, in our view," the investment bank said.
Elsewhere, Mexican shares dropped, as investors took some profits following recent strong gains on signs the U.S. economy is on solid footing. Mexico's economic health is tied closely to that of the U.S. since Mexico sends the vast majority of its exports north of the border.
In local corporate news, airport group Asur intends to bid on a new airport that the Mexican government is contemplating for an area that stretches along the Caribbean coast south from Cancun, also known as the Mayan Riviera.
Argentine issues retreated amid light trading volume, as a number of investors took the sidelines ahead of the Immaculate Conception holiday tomorrow.
Also, ongoing concerns about Argentina's escalating inflation and uncertainty over the new finance ministers ability to contain it weighed on investor sentiment.
Investors have reacted negatively to the government's efforts to contain prices by signing sector-specific agreements.
Thomson Financial Corporate Group - www.thomsonfinancial.com
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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.
Look where the guy is today?
There is no WON'T. Only political blah-blah-blah.