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To: Art Bechhoefer who wrote (2586)	10/21/1999 9:28:00 PM
From: Ruffian	Respond to of 13582

Mexico & Brazil Coming Along> Thursday October 21, 8:59 pm Eastern Time Turkey, Brazil best poised markets -Morgan Stanley NEW YORK, Oct 21 (Reuters) - Morgan Stanley Dean Witter and Co. said Thursday in a research note that Turkey's and Brazil's financial markets are the best positioned to benefit from improving fundamentals and an expected interest rate decline in some emerging market countries. The investment firm's global emerging markets strategy group said in the note that key emerging-market countries will see interest rates come down over the next few months, even while financial markets see a high likelihood of rate hikes by the Federal Reserve and the European Central bank in the developed world. Among countries that may see lowered rates are Turkey, Brazil, Mexico and South Africa, Morgan Stanley said, and among them Brazil and Turkey are the best positioned to benefit from the rate decline because they are currently burdened by double-digit real interest rates. Brazil is seeing a narrowing budget deficit and is poised for its best gross domestic product growth in three years, offering compelling valuations, the investment firm said. Turkey is in the process of approving a budget for next year, sanctioned by the International Monetary Fund, which contains a 20 percent consumer price index inflation target, Morgan Stanley said. Fundamentally, Brazil, Turkey, South Africa and Mexico are benefiting from improving fiscal conditions, corporate restructurings,and fairly valued or freely-floating currencies. Brazil, especially, is likely to see earnings growth accelerate, the research report said. Morgan Stanley said it is currently overweighting Brazil, Mexico and South Africa in its model portfolio and is watching Turkey, in which it is currently neutral.