Brazil shrs end up 6.55 pct on eve of crucial vote
Reuters, Tuesday, November 03, 1998 at 20:55
SAO PAULO, Nov 3 (Reuters) - Brazilian shares roared higher
Tuesday lifted by optimism that Congress would approve a key
reform bill on Wednesday, paving way for the government to
implement promised budget cuts, traders said.
The market's key Bovespa index (INDEX:$BVSP.X) ended up 6.55
percent at 7,509 points, building on a 7.8 percent jump on
Friday triggered by a declaration from the Group of Seven
nations that they would back Brazil's fiscal adjustment
commitments.
Markets were closed on Monday due to a national holiday.
"The market sees there is a very good chance the government
will get the social security reform bills cleared without any
problem," said one trader.
The lower house of Congress was to vote on Wednesday on the
final three amendments to a long-delayed social security reform
bill. The vote is viewed as a key test for the government to
see how much support it can get for its new fiscal plan.
The government had announced last week it would save a
total of $84 billion over the next three years through spending
cuts and tax hikes. The austerity plan was required of Brazil
to secure forthcoming international aid.
However, more than 80 percent of the announced measures
require Congressional approval.
Among Brazilian blue chips, Telebras preferred receipts
(SAO:RCTB40) jumped 5.49 percent to 96 reais, while Telesp
Participacoes (SAO:TLPP4) added on 9.84 percent to 33.50 reais.
Petrobras preferred (SAO:PETR4) rose 9 percent to 163.50
reais, while Eletrobras preferred (SAO:ELET6) 8.7 percent to 30
reais.
Volume was a moderate 473 million reais ($400 million).
Copyright 1998, Reuters News Service |
