Emerging Mkts ADRs:U.S. Rally Lifts Latin American Equities
Dow Jones Newswires
NEW YORK -- Emerging market shares trading as American depositary receipts started
stronger across the board Tuesday, boosted by higher world markets and hopes of an
interest-rate cut in the U.S.
On Friday, U.S. Federal Reserve chairman Alan Greenspan indicated in a speech that the Fed is
more concerned about a world market crisis than about domestic inflation, feeding hopes that the
agency's monetary policy committee will cut interest rates the next time it meets, on Sept. 29.
U.S. investors, encouraged by the prospect of a rate cut, sent the Dow Jones Industrial Average
up 291.37 points to 7932.22 at 1435 GMT.
"The U.S. rally is pulling all ADRs," a trader said. But he went on to caution the rise could be
short-lived. "It's a technical rally, with some short covering, but very little legitimate buying. I have
the feeling that people are still selling on strength."
Brazilian ADRs, the worst performers Friday, were mostly higher. At 1500 GMT, Telebras rose
4.2% to $63 3/16 amid heavy volume exchanged, while Telebras HOLDRs advanced 2.8% to
$64 3/16.
Unibanco was recovering from the sharp losses suffered by many financial stocks Friday. At
1500 GMT the bank was up 7.7% to $12 1/4.
Other Latin American ADRs were also climbing Tuesday.
Among the region's bellwethers, Argentine oil and gas company YPF rose 4.6% to $22 3/4 at
1510 GMT, while Mexico's Telmex advanced 5.8% to $38 13/16, and Venezuela's CANTV
was up 6.2% to $11 3/4.
Asian ADRs were up across the board.
"The yen has been stronger for the past two weeks, so people are more optimistic on prospects
for Asia," a trader said.
China and Hong Kong ADRs are outperforming other Asian issues, on the back of recently
implemented measures designed to curb short-selling in the respective local markets, dealers said.
"The measures have made it more difficult to continue to short, and are forcing to cover those
shorts," a trader said. "They have added calm to the market."
China Telecom rose 10.4% to $30 9/16, while Hong Kong Telecom advanced 8% to $20.
-By Margarita Palatnik; 201-938-2226; margarita.palatnik@cor.dowjones.com |
