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

To: md1derful who wrote (7436)	9/3/1998 5:46:00 PM
From: Steve Fancy	Read Replies (2) \| Respond to of 22640

Brazil declines comment on Moody's rating cut Reuters, Thursday, September 03, 1998 at 16:16 BRASILIA, Sept 3 (Reuters) - Brazil will not comment on a decision by Moody's Investors Service Inc to downgrade the country's speculative credit rating, a spokesman for the Finance Ministry said. "It is not our custom to comment on these things," the spokesman told Reuters. Moody's announced earlier it was downgrading its ceiling for Brazilian foreign currency bonds and notes to B2 from B1 and the ceiling for foreign currency bank deposits to Caa1. The spokesman said ratings agencies were frequently wrong, as they had been before the Asian economic crisis when countries like Thailand had better credit ratings than Brazil. "They were completely wrong, and today nobody in their right mind thinks Southeast Asia is a better place for foreign direct investment than Brazil," he said. "They don't have the slightest credibility among Brazilian economists today." Copyright 1998, Reuters News Service

To: md1derful who wrote (7436)	9/3/1998 5:48:00 PM
From: Steve Fancy	Respond to of 22640

Brazil Cenbank seen intervening in forex markets Reuters, Thursday, September 03, 1998 at 16:16 SAO PAULO, Sept 3 (Reuters) - Brazil's Central Bank was seen selling dollars in the local foreign exchange markets in late trade Thursday in a bid to calm nervous investors amid a global economic fears, traders said. The bank was seen intervening through state-owned Banco do Brasil, selling the U.S. currency at around 1.1780 to the dollar, traders said. The Central Bank would not comment on the reported dollar sales. The real opened at 1.1780 to the dollar, or 0.08 percent lower than Wednesday's close, and stayed hovering around that level for most of the day until the Central Bank reportedly stepped in to prevent the currency from falling further. The real was still trading at 1.1780 by 1655 local/1955 GMT. Forex dealers said the commercial foreign exchange market was suffering a large net outflow of dollars amid an escalating crisis. "The continuous outflow of dollars is scary. And news that Moody's cut its credit rating on Brazilian debt fell like a bomb on the market," one local dealer said. Moody's Investors Service said it downgraded its credit ratings on the country's foreign currency debt to B2 from B1. Dealers said there was practically no expectation for a dollar inflow in the market under the current situation. In the local futures market, October dollar contracts were trading up 0.16 percent, while November contracts were trading up 0.21 percent, meaning the U.S. currency's value was seen rising more in the near future. The local bourse was also reflecting the nervousness in Brazilian markets. The key Bovespa index (INDEX:$BVSP.X) was down 8.45 percent at 6,230 points shortly before the session's close. Brazil's dollar-denominated C-bonds <BRAZILC=RR> traded in New York, was down 0.750 points at 54.75 at 1700 local/1800 gmt. noriko.yamaguchi@reuters.com)) Copyright 1998, Reuters News Service

To: md1derful who wrote (7436)	9/3/1998 5:52:00 PM
From: Steve Fancy	Respond to of 22640

ADR REPORT - Emerging markets highlights - Sept 3 Reuters, Thursday, September 03, 1998 at 16:26 TELEBRAS DROPS AFTER MOODY'S CUTS BRAZIL'S CREDIT RATING NEW YORK, Sept 3 (Reuters) - Brazil's telecommunications behemoth Telebras S.A. (SAO:TEL_.P) (NYSE:TBR) slid nearly 10 percent in Thursday afternoon trading after the country had its credit rating cut and investors lost even more in confidence in emerging markets. "It also doesn't help that the Dow is down," said one dealer. The Dow Jones Industrial Average was down 171 points or 2.20 percent at 7610, following the slide suffered by local markets in Argentina, Brazil and Venezuela. Moody's Investors Service downgraded Brazil's country ceiling for foreign currency debt to B2 from B1, among other debt, heightening worries about its currency and economy. It also cut the country ceiling for foreign currency for Venezuela. An official at rival credit-rating agency Standard & Poor's told Reuters the two countries were the least creditworthy in the region. "This is bad," said another trader. "Our economist was surprised by this," said another, adding that Moody's was nevertheless considered to have a conservative perspective. "Things are active," he added. Meanwhile, Latin American finance officials meeting at the International Monetary Fund in Washington urged investors not to bow to overwhelming pressure to abandon emerging markets. The officials said many of the region's countries were prepared to withstand the turmoil in global markets, which has been aggravated by Russia's worsening financial crisis. Investors have begun to worry about the possible effects that Colombia's de facto currency devaluation might have on Venezuela's bolivar and the sucre in Ecuador. Shaun Roache, an emerging markets strategist at ING Barings in London, told Reuters earlier in the day that the best defensive asset allocation for a fund dedicated to the region would be to have 20 percent in cash. Roache also recommended keeping the remainder in stocks that follow benchmark indices like those set by Wall Street firm Morgan Stanley. Copyright 1998, Reuters News Service