ADR REPORT - Emerging market highlights - Sept. 4
Reuters, Friday, September 04, 1998 at 16:54
BRAZIL ADRS POUNDED AMID WORRIES ABOUT DEVALUATION, REGION
NEW YORK, Sept 4 (Reuters) - Brazilian American Depositary
Receipts (ADRs) dropped to near 12-month lows Friday, pounded
by uncertainty about Brazil and the rest of Latin America.
Traders said the outflow of foreign funds from Brazil was
helping force down the ADRs. They represent underlying shares
that trade on the Sao Paulo exchange.
Brazil's blue-chip Bovespa index was down 7.51 percent in
late afternoon. The New York Stock Exchange's list of
percentage-loss leaders was packed with lLeading ADRs from
Brazil and other Latin American countries.
"It's getting pretty boring -- every day some bad news and
the market down five percent," a trader said.
"The Latin Americans feel that they are victims of the
international scenario. They feel pretty helpless."
The outflow "is leading to a concern about devaluation in
Brazil," a second trader said. Foreign exchange dealers
estimated $3.8 billion had fled Brazil's commercial and
floating foreign exchange markets in the first three days of
the month.
Moody's Investor Service cut debt ratings for Brazil and
Venezuela Thursday. It also put Mexico and Argentina on review
for possible downgrades.
Investors have feared that Brazil and Venezuela could be
the first big Latin American countries to devalue their
currencies amid concerns about emerging markets worldwide.
Lehman Brothers said in a report about Brazil that "the
risk of default remains small, although the potential for
further macroeconomic turbulence has grown.
"... The critical event for Brazil going forward will
probably be what kind of adjustment is proposed after the
October (general) elections."
Among market gauges, the ING Barings Latin American index
of leading regional stocks <.LAT> was down 4.21 points, or 4.16
percent, to just off a record low of 96.98 points. The index is
off 55 percent from its high this year.
Here are some highlights among emerging market ADRs:
* * *
BRAZIL - Bellwether Telebras SA (SAO:TELB4) (NYSE:TBR) fell
4-1/8 to 60-3/4 in heavy trade, just off a 12-month low of
60-3/16.
Supermarket chain Pao de Acucar (NYSE:CBD) (SAO:PCA) was off
2-7/8, or 23.96 percent, to 9-1/8, just off a record low of
8-3/4.
Power company Companhia Paranaense de Energia (SAO:CPL)
(NYSE:ELP) was off 13/16, or 16.67 percent, to 4-1/16, a record
low. Trade was light.
Bank Unibanco Group (SAO:UBB) (NYSE:UBB) fell 1-1/2, or 11.11
percent, to 12, a record low. Volume was more than seven times
normal daily levels.
Pulp company Aracruz Celulose (SAO:ARC) (NYSE:ARA) fell 9/16,
or 10.23 percent, to 4-15/16, just off a record low. Trade was
heavy.
Brewer and bottler Brahma (NYSE:BRH) (SAO:BRH) was off 7/8, or
9.46 percent, to 8-3/8, a record low.
* * *
VENEZUELA - Telephone company CANTV (VEN:TDV.D) (NYSE:VNT) was
up 13/16 to 11-9/16.
* * *
CHINA - Leading Chinese ADRs were stronger overall and
clustered among percentage-gain leaders on the New York Stock
Exchange.
The increases came after Hong Kong's China-Affiliated
Corporations Index rose 14.95 percent on the back of talk of
lower Chinese interest rates and as pressure for a devaluation
of the Chinese yuan eased with the weakening of the dollar.
Among them, Beijing Yanhua Petrochemical Co. Ltd. (HKSE:0325)
(NYSE:BYH) was up 13/16, or 28.26 percent, to 3-11/16, and China
Southern Airlines Co. Ltd. (NYSE:ZNH) (HKSE:1055) was up 13/16, or
20.97 percent, to 4-11/16.
Copyright 1998, Reuters News Service |
