*ALERT: Thomson Financial is discontinuing its Latin America daily
commentary on Friday, July 14, due to low usage of product. The last
commentary will be released on Thursday, July 13. Real-time market data can
be found for the Brazilian, Mexican and Argentine markets using the news
function on Thomson One. If you have any questions, or need further
assistance, please contact Linda Shea at Linda.Shea@thomson.com
Thursday, July 13, 2006, 4:45 PM ET (Thomson Financial): Latin American
shares followed global markets into the red, as violence in the Middle
East, specifically between Israel and Lebanon, sparked investor concern.
Meanwhile, explosions in Nigerian pipelines also supported a surge in crude
oil prices to US$76.70 a barrel, a record high.
Brazil's Bovespa Index plunged 816.37 points, or 2.31%. Mexico's
benchmark Bolsa negated 694.18 points, or 3.57%, while Argentina's Merval
Index receded 57.41 points, or 3.37%.
Brazilian shares witnessed sharp declines on the day. A surge in crude
oil prices does not bode well for the local economy, as Brazil is a net
importer of oil. Further supporting oil prices, the Energy Department's
weekly crude inventories data showed a sharp decline in supplies.
In economic reports, the Getulio Vargas Foundation's General Price
Index, or IGP-M, rose 0.17% in the first 10 days of July compared to a
0.27% jump during a similar period in June. The latest result was in line
with analyst expectations.
On the earnings front, paper and pulp producer Votorantim Celulose e
Papel said that its second-quarter net profit fell 5% to 200 million reais
from 211 million reais a year ago. The latest decline was due to falling
local paper and pulp prices amid strength in the Brazilian real versus the
greenback. Net operating revenue inched up 4% to 708 million reais from 683
million reais, while Ebitda rose to 292 million reais from 260 million
reais.
O Globo newspaper said that Bolivia tempered its asking price for the
natural gas it exports to Brazil. Bolivia is now looking for a price of
US$5 per million British thermal units, from a possible hike to US$5.70 per
million BTU. At one point earlier this year, Bolivia's Hydrocarbons
Minister hinted at US$7.50 per million BTU.
Turning to sales data, grocer CBD said that its same-store sales for
June rose 2.6%, compared with the year-earlier period.
Once again, Mexican equities were unable to shake weakness, marking the
fifth- straight session in the red. Still, on a brighter note, industrial
production for May came in above expectations, rising 5.7%. Industrial
production was down a slight 0.04% from April on a seasonally-adjusted
basis.
A major investment bank initiated coverage on airport operator Asur at
"equal weight," as the brokerage sees greater potential for downside risk
as opposed to an upside at this point in time due to "tight route control."
Argentine issues tumbled alongside weakness across the region and
abroad. Torcuato Di Tella University reported that consumer confidence fell
1.3% in July from a month ago, following a 3.1% increase in June.
-- Linda.Shea@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 reports. If you have any questions please e-mail James Sang at
james.sang@tfn.com or call 646.822.6233. For more information about Thomson
Financial, please visit our web site at http://www.thomsonfinancial.com.
SOURCE Thomson Financial Corporate Group
back to top
