Thursday, April 6, 4:45 PM EDT (Thomson Financial): Latin American stocks
were mixed, with Brazilian shares garnering some support from continued
expectations for improved economic growth this year amid tame inflation.
Meanwhile, Mexican issues dropped, as investors locked in some profits
following recent strong gains.
Brazil's Bovespa Index added 231.84 points, or 0.59%. Mexico's benchmark
Bolsa Index fell 60.92 points, or 0.31%, while Argentina's Merval Index dipped
5.44 points, or 0.29%.
Brazilian stocks edged up amid continued optimism about the Brazilian
economy's growth prospects this year. Fueling expectations the economy will
continue to gain steam, data released earlier this week showed that Brazilian
industrial output rose 1.2% in February from a month earlier. Meanwhile,
recent inflation data has shown inflation largely under control, which should
allow the central bank to continue cutting interest rates. The bank is
expected to cut the benchmark Selic interest rates by 75 basis points at its
next meeting on April 19. The rate currently stands at 16.5%.
In today's news, Fitch Ratings said Brazil is well-positioned for seeing
debt ratings upgrades in coming years. "The trend in terms of balance of
payments and external solvency, as well as public debt dynamics, suggest that
there are prospects for an upgrade within the next two years," the ratings
firm said. However, Fitch added that Brazil still faces risks from domestic,
political and electoral factors.
Meanwhile, a poll released today by the Public Opinion Research Institute
(Ibope) showed that support for President Luiz Inacio Lula da Silva in Sao
Paulo is now below that of the opposition. The poll showed Lula receiving 21%
of the vote in Sao Paulo in the October presidential election, versus 25% for
former Sao Paulo governor Geraldo
Alckmin, the candidate of the opposition Social Democratic Party.
Brazil's central bank today announced personnel changes in the top posts
of its international affairs, financial system regulation and special studies
units. Observers largely viewed the changes as signaling a continuation of the
central bank's prudent monetary policies, according to news services.
In corporate news, a major investment bank initiated coverage of
investment fund Bradespar Participacoes at "buy," saying the fund is "an
attractive and clever way of gaining exposure" to mining giant CVRD.
Mexican issues took a modest breather today, following three-consecutive
sessions of gains where the key IPC index continuously hit all-time highs.
U.S. shares also faltered today, ahead of tomorrow's March employment report.
Airport operator Asur said that March passenger traffic tumbled 11.9% from
the corresponding period a year ago, as last year's hurricanes continued to
take a toll.
Argentine shares followed a similar pattern to their Mexico peers,
slipping lower on the day following record highs reached yesterday.
Amid a quiet news day, privately held Electroingenieria said that it would
like to purchase Petrobras Energia's stake in Transener.
-- Paul.Davee@thomson.com; Thomson Financial Corporate Services
This is Thomson Financial Corporate Services Latin American Commentary.
The information herein is believed to be true and accurate, we take no
responsibility for inaccurate information and reserve the right to update our
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SOURCE Thomson Financial Corporate Group
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