Brazil shrs end at 9-mo low on emerging mkt woes
Reuters, Tuesday, August 11, 1998 at 17:21
SAO PAULO, Aug 11 (Reuters) - Brazilian shares took another
dive on Tuesday, with the key Bovespa index (INDEX:$BVSP.X) closing at
its lowest level since November 14 after investors dumped
shares on concerns Asia's economic troubles may infect Brazil.
The Bovespa, which groups the 58 most actively traded
shares, ended down 4.14 percent at 8,802 points -- a level not
seen since the thick of the Asian market tumult last fall. The
index was down for an eighth straight session.
"The fall is just too much," said one trader at Doria &
Atherino brokerage. "But nobody can tell when it will recover,"
he added.
The Bovespa was down 13.6 percent so far this year.
Brokers said that liquidity on Latin America's largest
bourse was waning, even though Wednesday marked the expiration
of Bovespa index futures. Trading usually jumps prior to the
expiration.
On Tuesday, shares worth 602 million reais ($518 million)
changed hands. Meanwhile in the futures' market, less than 500
contracts were rolled over to the new contracts, one trader
said. That compares with about 35,000 contracts on Monday.
Market benchmark Telebras preferred (SAO:TELB4) plunged 4.75
percent to 114.30 reais.
Brokers attributed the slump in Brazilian shares to
concerns that economic troubles besetting Japan and other Asian
markets may have a contagion effect on the other side of the
Pacific.
"The fall in the yen is the most worrying factor, since it
rattles other emerging markets and the Dow Jones, but the fall
in Russian shares is obviously another nerve-wracking element,"
said one local trader.
Russian shares closed down 9.11 percent on Tuesday. Its
leading RTS1-Interfax, at 109.90, was at its lowest level since
May 1996.
Among other Brazilian blue chips, Petrobras preferred
(SAO:PETR4) ended down 1.49 percent at 199 reais, while
Eletrobras preferred B (SAO:ELET6) closed down 3.81 percent at
30.30 reais, while Vale do Rio Doce preferred (SAO:VALE5)
plummeted 7.21 percent at 19.30 reais.
Brazil's real took a quick dive early on, but managed to
end up a slight 0.01 percent at 1.16881 reais against the
dollar after reported intervention by a federal bank on behalf
of the Central Bank.
noriko.yamaguchi@reuters.com))
Copyright 1998, Reuters News Service |
