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

To: Steve Fancy who wrote (7445)	9/3/1998 7:04:00 PM
From: Steve Fancy	Respond to of 22640

Brazil, Venezuela ADRs Pile Losses On Currency Downgrades Dow Jones Newswires NEW YORK -- American depositary receipts of Venezuelan and Brazilian companies were piling up losses Thursday afternoon after Moody's Investor's Service announced it was downgrading both countries' foreign currency debt. Although traders downplayed Moody's relevance, they said it won't help these already beaten-up markets. "Not many people listen to Moody's," a dealer said. "But on the back of bad sentiment it's not going to help." ADRs of bellwether Brazilian Telebras fell 6 1/16 or 8% to $66 7/8 at 1900 GMT. "I never thought I'd see it back at $67," a trader said. "There is no technical support at all." Utility Copel was sliding 7% to $4 15/16, while retailer Pao de Acucar was the biggest loser, dropping 10.7% to $12. Meanwhile, Venezuelan benchmark CANTV took another dive, down 10% to $10 11/16. Paint-maker Corimon was also down 14% to $3/4. "The question is, 'Is anyone going to come back to these markets?'" a despondent-sounding trader said.

To: Steve Fancy who wrote (7445)	9/3/1998 7:06:00 PM
From: Steve Fancy	Respond to of 22640

Latin American Leaders Face Econ Woes At Summit In Panama Dow Jones Newswires PANAMA CITY (AP)--Leaders of 14 Latin American nations will meet in Panama this weekend, hoping to find a common approach to the global economic crisis that has rattled their countries. Foreign ministers are due Friday, followed Saturday by presidents from 10 countries and stand-ins from four others for the Rio Group summit. Summit spokeswoman Ivette Franco Koroneos said the leaders would try to agree on a common statement about the economic crisis, which caused stock markets and currencies to plummet across Latin America. Discussions are also planned on security, relations with Europe, development of science and technology, trafficking in arms and drugs and cooperation against terrorism, she said. The summit could give the presidents of Peru and Ecuador a chance to discuss a border conflict that has led to sporadic fighting. The Rio Group, which held its first annual summit in 1987, aims to raise the Latin American alliance to the level of other regional groups, Franco Koroneos said. Eight nations - Colombia, Mexico, Panama, Venezuela, Argentina, Brazil, Peru and Uruguay - founded the group in Rio de Janeiro in 1986. It grew to include Bolivia, Chile, Ecuador, El Salvador, Guyana and Paraguay. Latin American finance ministers and central bankers are meeting Thursday and Friday with the International Monetary Fund in Washington.

To: Steve Fancy who wrote (7445)	9/3/1998 7:07:00 PM
From: Steve Fancy	Respond to of 22640

Brazil Postpones Bid Rules For Telecom Mirror Cos To Friday Dow Jones Newswires BRASILIA -- The publication of the sale prospectus containing the bidding rules for the concessions of competing telecommunications companies has been postponed to Friday, the National Telecommunications Agency, known as Anatel, said Thursday. The prospectus was scheduled to be issued Thursday, but Anatel board members worked throughout Wednesday night to finalize some details, the agency said. The winning companies, known as "mirror companies," will compete with the three fixed-line units and long-distance and international operator Empresa Brasileira de Telecomunicacoes SA (E.EMB), known as Embratel, which were sold during the privatization auction of Telecomunicacoes Brasileiras SA (TBR), known as Telebras, on July 29. Each privatized company is due to face one other private "mirror" competitor in its area. Anatel previously announced that no minimum bid price will be published for the "mirror" concessions. The agency said "a bottom price" has been set by the board but will be not be revealed. If bids don't exceed this bottom price, the concession won't be granted and a new auction will be called, Anatel said. -By William Vanvolsem; (5561) 244 3095; wvanvolsem@ap.org

To: Steve Fancy who wrote (7445)	9/3/1998 7:07:00 PM
From: Steve Fancy	Respond to of 22640

Goldman Analyst:Brazil Must Hike Rates To Avoid Devaluation Dow Jones Newswires NEW YORK -- Brazil, the linchpin economy in Latin America, must hike interest rates and impose rigorous budget reduction policies to fend of a crippling currency devaluation and possible recession, according to Jorge Mariscal, vice president of Latin American equity research for Goldman Sachs & Co. In an interview with CNBC Thursday, Mariscal said Brasilia officials "for political reasons" have not acted quickly enough to impose these measures. Elections are scheduled there for October. Discussions about cutting interest rates have also taken place in Brazil. But Mariscal characterized that maneuver as "lighting a match next to a powder keg." He said raising rates will provide Brazilian investors with incentive to stay with their local economy, since it will lessen the risk of devaluation. Otherwise, a flight to U.S. dollars will occur, he added. Mariscal played down fears that Colombia's financial woes could spark the rest of Latin America into chaos, much like Thailand did Asia. "It's a very small country with fairly small trade links with rest of Latin America," he explained. - Scott Eden; 201-938-5173

To: Steve Fancy who wrote (7445)	9/3/1998 7:09:00 PM
From: Steve Fancy	Respond to of 22640

U.S.'s Rubin: Says Meeting "Very Useful" Dow Jones Newswires WASHINGTON -- Emerging from what he called a "very useful" meeting to deal with the effects of the global market crisis on Latin America, U.S. Treasury Secretary Robert Rubin criticized the capital controls put in place by another emerging market, Malaysia. "I think the actions taken by Malaysia yesterday are of concern," Rubin said, as he left from the meeting between International Monetary Fund officials and high-ranking Latin American policy-makers. "Obviously, it's not the path we think lends itself to economic growth and stability over time." Speaking to reporters, Rubin said that during the first of the two days of meetings, Latin American officials discussed "interest rates and international monetary conditions." Rubin declined to comment on the possibility that the U.S. Federal Reserve may cut short-term U.S. interest rates. But Rubin said market-set U.S. rates, such as those on the 10-year and 30-year U.S. Treasury bonds, have come down "very substantially." He called those rates "the critical interest rates for our economy." Rubin said that during Thursday's meeting, Brazilian finance minister Pedro Malan and other Latin American finance ministers and central bank presidents said they were deeply concerned about the effects the ailing Japanese economy could have on Latin America. Rubin reiterated the U.S. administration's support for fully funding the IMF. His comments came after the U.S. Senate approved a bill Wednesday that includes such funding. He also denied rumors that surfaced Thursday of a possible emergency meeting for the Group of Seven industrialized nations to deal with global currency woes. "There is no such meeting," Rubin said. Rubin said the Latin American ministers felt that markets had failed to recognize the "tremendous" accomplishments in the region in recent years. The ministers felt, Rubin said, that "what those participants in markets would be much better advised to do would be to differentiate and take a look at each country, and determine what that country has done, and what prospects that country offers." "Take a look at our economy, the U.S. economy. I think we continue to be on a path of solid growth and low inflation," Rubin said. "And, as I look forward, it seems to me that's far and away the most likely scenario."

To: Steve Fancy who wrote (7445)	9/3/1998 7:13:00 PM
From: Steve Fancy	Respond to of 22640

Latin Markets Plunge Thursday As Bad News Multiplies By MARGARITA PALATNIK Dow Jones Newswires NEW YORK -- Latin American markets plunged Thursday, amid a barrage of bad news that continues to undermine investor sentiment in the region. Moody's Investors Service Thursday afternoon downgraded its rating on the foreign-currency denominated debt of Venezuela and Brazil. The ratings agency also placed the long-term foreign currency debt of Mexico and Argentina, and 11 Argentine banks under review for possible downgrade. Additionally, Venezuela suspended a planned privatization of its aluminum company due to a lack of bidders. It was the third such suspension in six months, and was sure to diminish what is already waning investor confidence in the country. The flurry of negative news concerning Latin markets on Thursday followed Wednesday's decision by Colombia to effectively devalue its currency by shifting upwards the band in which the peso trades against the dollar by nine percentage points. Against that backdrop, finance ministers from Latin American countries met with representatives from the International Monetary Fund in Washington to try to contain the damage to their economies from the ongoing global financial crisis. Meanwhile, Latin American debt and equity markets suffered steep losses. At 1945 GMT, Brazil's Capitalization bonds were off 1 at $54 3/4. The Bovespa stock market index fell 555 points, or 8% to 6249. Venezuelan Par bonds were down 1 3/4 to 57 3/4, while the Caracas General index lost 222.13 points to 2726.53. Mexican Par bonds were down 11/16 to 72 9/16, and the IPC stock market index slipped 82.51 points, or 2.6% to 3096.04. Argentine Par bonds were down 2 1/8 to 62 3/8 bid, as its leading Merval index slipped 23.75 points, or 6%, to 3090.42. Market participants said that increasingly the ills affecting Latin America are originating from its own shores, adding to the negative effects of crises in Asia and Russia. "Up until yesterday, it was really mostly bad things happening to Latin America," said Jorge Mariscal, Latin America strategist at Goldman, Sachs & Co. "But today and yesterday, Latin America is doing bad things to itself," Mariscal said. He cited Brazil's decision Wednesday to lower interest rates and to Venezuela's refusal to devalue. "Lowering interest rates was a bad decision to compound Brazil's troubles," he said. "And Venezuela, if they were near the cliff, now they're a step closer." For weeks, investors have considered a devaluation of the bolivar an imminent prospect. "They have enough reserves to hold out for weeks or months if they chose to, but why waste it all if they have to readjust their currency anyway?" Mariscal said. Market observers dismissed Moody's downgrades. "Who didn't expect that?" asked an corporate bond analyst. A trader said Moody's actions were backward-looking. And Goldman's Mariscal said "It just confirms how much behind rating agencies are. Not only are they covering the well after baby has drowned, but now they're pushing the baby back into the well. It's not constructive at all." As for the IMF meeting in Washington with Latin American officials, analysts are pessimistic. "I've been very puzzled about the prospects of the IMF meeting," said Erik Nilsson, senior Latin America economist for Scotiabank. "The IMF has no money to throw around any more, and given the political time-table in Latin America, it isn't certain what the IMF can do." Nilssen mentioned upcoming elections in Venezuela, adding that Argentina's president Carlos Menem's term is coming to an end, and Mexico's president Ernesto Zedillo is entering his last two years in office, making it politically difficult for the leaders to commit to long-term programs. -By Margarita Palatnik; 201-938-2226; margarita.palatnik@cor.dowjones.com

To: Steve Fancy who wrote (7445)	9/3/1998 7:17:00 PM
From: Steve Fancy	Respond to of 22640

World Bank Wolfensohn To Join IMF/LatAm Press Conf. Fri. Dow Jones Newswires WASHINGTON -- World Bank President James Wolfensohn will return from abroad in time to join the heads of the International Monetary Fund and Inter-American Development Bank at a press conference at 2:30 p.m. EDT Friday, a World Bank spokesman said Thursday. The press conference will mark the end of a two-day gathering of Latin American finance and central bank officials to discuss responses to the Asian and Russian financial crises. U.S. and Canadian officials, including U.S. Treasury Secretary Robert Rubin, have also attended the meeting, which was hastily called by IMF Managing Director Michel Camdessus last week amid Russia's mounting financial turmoil. Wolfensohn has been attending a Mediterranean Development Forum conference in Marrakesh, Morocco, but will land in Washington around 11:00 a.m. EDT in time to make it to the final press conference, the spokesman said. Camdessus and Inter-American Development Bank President Enrique Iglesias will also attend the press conference. -By Kristi Bahrenburg, tel: (202) 862-9295; or e-mail: kristi.bahrenburg@cor.dowjones.com

To: Steve Fancy who wrote (7445)	9/3/1998 7:18:00 PM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil's Franco Denies Curbs On Dollar Outflows Dow Jones Newswires BRASILIA -- No special measures are being considered to restrict the heavy outflow of U.S. dollars, Central Bank president Gustavo Franco said through his press office late Thursday. Franco is in Washington attending a meeting of Latin American finance ministers with International Monetary Fund officials on the current upheavals in Russia and Asia. A Central Bank spokesman said Franco denied rumors circulating in Brazil earlier Thursday that the government was about to introduce restrictions on capital outflows which have been surging in recent days. Market sources claim the country is losing some $1 billion a day since the Russian crisis last week and that the outflow could snowball following Moody's Investor Service's downgrading of the rating on Brazil's foreign debt Thursday. -By William Vanvolsem; (5561) 244 3095; wvanvolsem@ap.org