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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: Art Baeckel who wrote (21427)	8/21/2000 9:06:41 AM
From: Art Baeckel	Read Replies (2) \| Respond to of 22640

WEEKAHEAD - LatAm stocks promise mixed bag Reuters Company News - August 20, 2000 11:02 Jump to first matched term By Katherine Baldwin SAO PAULO, Aug 20 (Reuters) - Latin American shares promise to be mixed this week as the region's markets await a key U.S. Federal Reserve meeting and traders keep an eye on Argentina, where economic uncertainty is weighing on the bourse. Stock markets, particularly in Mexico and Chile, may languish early in the week ahead of a Fed policymakers' huddle on Tuesday to decide whether to raise interest rates, traders said. And while Brazil shares stand to gain from a wealth of good news in past days, the region's biggest market could struggle to keep its head above water as neighbouring Argentina faces speculation over a shift in macro-economic or exchange rate policy. The region's quiet spot should be Venezuela where a summer holiday season will bring meagre trading this week. ARGENTINA is Latin America's primary wild card this week where shares are seen extending last week's hefty losses as uncertainty over the stagnant economy continues to scare away investors. The benchmark Merval index shed 5.8 percent last week, capped by a 2.9 percent drop on Friday as traders circulated speculation that the government could fail to meet International Monetary Fund targets or abandon its currency peg to the dollar. "Expectations are just so low right now, and until they change, we'll continue to have a weak market subject to these rumours," said Alfredo Ferrarini, a trader for Cohen brokerage. The performance of BRAZILIAN shares this week hinges on Argentina, traders said. But the market could climb on the back of solid growth numbers, healthy corporate earnings and Moody's Investors Service announcement on Thursday that it was mulling upgrading the country's credit-worthiness. "Everything points to the market retaking an upward trend," said Silvio Carvalho, a trader at Banespa brokerage in Sao Paulo, adding that eyes will be glued on Argentina. Brazil's benchmark stock market index slipped 0.5 percent last week as profit taking on Friday erased gains earlier in the week. Shares in oil giant Petrobras could lead the market higher again after the company posted record second quarter earnings last week, traders said. But the Bovespa could stumble on Monday with the expiration of futures, traders added. MEXICAN stocks should look northward to the Fed meeting this week given the market's close ties with the U.S. economy. Higher interest rates can slow U.S. growth and squeeze funds available for emerging markets. Mexico's benchmark index of the most-traded shares closed down 2.3 percent Friday for a weekly retreat of 1.76 percent. "We will continue with low-volume sessions because of a lack of participation of investors who are waiting for the Fed meeting," said one analyst, who asked not to be named. But stocks could rise once the Fed Reserve meeting is over, the analyst said. Mexico's economy grew at an annualized rate of 7.6 percent in the second quarter of the year, the Finance Ministry reported Tuesday. In VENEZUELA, stocks are expected to trade sideways in the midst of the summer holiday season, with investors eyeing consumer products maker Mavesa and banks. Caracas' benchmark IBC index slipped 0.2 percent Friday to close at 6,491.12 , down 3.82 percent on the week. "I expect the market to stabilise around these levels, but trading volumes could fall even further as we are in the middle of holiday season," said Carlos Sanchez of the Activalores brokerage. Players will watch a Mavesa shareholders meeting on Monday which is due to vote on a repurchase scheme for up to 15 percent of the company's stock. And investors will continue to watch for a rumoured acquisition of Venezuela's No. 4 bank Banco Caracas by a unit of Spain's Banco Santander Central Hispano , Banco Venezuela. The deal had been expected to be signed two weeks ago, and Banco Caracas' stock has been punished in recent days as both sides were silent on the deal. In CHILE, stocks are set to tread water on Monday with investors reluctant to make bold moves before the Fed rate meeting. The market does not expect the central bank to touch rates, they said, so a hike would send stock prices south. At an unknown time during the week, the government will release the May-July unemployment figure . A Reuters poll foresaw the number at between 9.3 percent and 9.8 percent. The jobless rate has been gradually rising since the start of the year. The IPSA index of leading stocks rose 0.82 percent to 100.11 points on Friday, the first time since July 12 that it crossed the 100-point line, where it started the year.