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

To: md1derful who wrote (7846)	9/11/1998 11:10:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Doc, where you finding this news? sf

To: md1derful who wrote (7846)	9/11/1998 11:17:00 AM
From: Steve Fancy	Respond to of 22640

Brazil currency reserves at $52 billion-Cenbank Reuters, Friday, September 11, 1998 at 10:02 BRASILIA, Sept 11 (Reuters) - Brazil's foreign currency reserves, in net terms, stood at $52 billion after strong outflows on forex markets Thursday, the Central Bank said Friday. A Central Bank spokeswoman said $1.8 billion left Brazil via foreign exchange markets Thursday. "There were reports that reserves had fallen further than that, but they are not true," the spokeswoman said. Foreign reserves represent Brazil's best weapon against speculative attack on the local currency, the real. Central Bank monetary policy director Francisco Lopes told reporters Thursday that reserves stood at about $55 billion, down more than $12 billion since the end of August. The Central Bank late Thursday raised its lending rate to 49.75 percent annually from 29.75 percent in an apparent attempt to stem dollar outflows and keep reserve levels high. william.schomberg@reuters.com)) Copyright 1998, Reuters News Service

To: md1derful who wrote (7846)	9/11/1998 11:18:00 AM
From: Steve Fancy	Respond to of 22640

Brazil shares tumble 3.06 pct despite rates hike Reuters, Friday, September 11, 1998 at 10:02 SAO PAULO, Sept 11 (Reuters) - Brazilian shares tumbled 3.06 percent in the first 10 minutes of trading on Friday as investors dumped stocks on concern over the economic outlook of the country even after a new rates hike, traders said. Sao Paulo's key Bovespa index plunged to 4,615 points, extending Thursday's deep losses of 15.82 percent. "Today is going to be as bad or worse than yesterday," one trader said. "A rise in interest rates only works if there is credibility...I only see one solution and it has to come from outside Brazil." Other traders were more optimistic, expecting the market to level out as the session progressed, calmed by a stabilization on Wall Street. Copyright 1998, Reuters News Service

To: md1derful who wrote (7846)	9/11/1998 11:20:00 AM
From: Steve Fancy	Respond to of 22640

Brazil stocks jump as rates hike sinks in-traders Reuters, Friday, September 11, 1998 at 10:02 SAO PAULO, Sept 11 (Reuters) - Brazilian shares jumped 2.62 percent in morning trade on Friday, reversing initial losses on expectations that the government's interest rate hike will stop sharp dollar outflows, traders said. The Bovespa surged to 4,886 points after tumbling more than 3 percent in the first 10 minutes of trading. The Central Bank announced late Thursday night that it is boosting interest rates 67 percent, less than a week after it raised them 50 percent. The announcement was expected to help staunch capital flight which was draining reserves and putting pressure on the country's currency. Concern over dollar flight sent the Bovespa plunging more than 15 percent on Thursday. Traders said that after they finished completing their sell orders from the day before, the measures began to sink in. "This is good news for stocks in the short term," a trader said. "It shows a determination to defend the real and could even attract investors to Brazil with better returns on fixed-income," he added. The rise came even as Wall Street slipped 0.8 percent in early trading. Copyright 1998, Reuters News Service

To: md1derful who wrote (7846)	9/11/1998 11:21:00 AM
From: Steve Fancy	Respond to of 22640

Brazil hikes rates to ease devaluation fears Reuters, Friday, September 11, 1998 at 10:02 By John Miller SAO PAULO, Sept 11 (Reuters) - Brazil jacked up interest rates to nearly 50 percent late Thursday in a desperate bid to slow dollar flight and ease fears that Latin America's economic leader would be cornered into a massive devaluation. The Central Bank raised its basic lending rate to 49.75 percent from 29.75 percent after a hectic day that saw investors yank more than $2 billion out of the country and local shares take their biggest one-day plunge in 11 years. Economists said on Friday that the move should in the short run stem massive dollar outflows, which have drained hard currency reserves to nine-month lows and rocked faith in the government's successful four-year inflation-busting plan. "The big question mark is will this restore confidence in Brazil? I think it will in the short-term," said Carlos Kawall, an economist at Citibank in Brazil. The rate hike was sure to be viewed positively by Brazil's neighbors, whose smaller economies would be thrashed by any sudden devaluation. Brazil, with an $800 billion a year economy that is almost twice the size of Mexico's, imports many goods produced in the region. The interest rate hike follows a more modest one last Friday -- which took rates to 29.75 percent from 19 percent -- and a set of budget cuts on Tuesday. But both failed to soothe market fears about an eventual devaluation in Brazil. Economists said the persistent market unease and a worsening global economic outlook forced a more drastic response from policy-makers. "Most of the foreign money that was in stocks and bonds has already left. This was a message to both local investors and world markets, but what could really sink the ship are the locals," Kawall said. Economists also said the move was consistent with repeated government assurances that it will go to whatever extremes necessary to stave off devaluation. Brazil is relying on the same battle plan it adopted last October, when its currency came under speculative attack amid the Asian currency crisis. The Central Bank more than doubled annual interest rates to 43 percent and then gradually reduced them each month as investors grew more confident in the government's ability to defend the local currency, known as the real. Over the past two weeks, the Central Bank has sold dollars heavily to keep the real trading within a narrow band. It is currently trading at about 1.179 reais to the dollar at the official commercial rate. On the black market, a dollar is fetching about 1.30 reais. If the rate hike stays in place for several months, it could throw the already weak Brazilian economy into recession early next year. But even though the hike comes less than a month away from Oct. 4 general elections, opinion polls show the economic crisis has actually boosted President Fernando Henrique Cardoso's popularity. A nationwide public opinion poll released on Thursday showed 47 percent of those surveyed would vote for Cardoso, up from a previous 44 percent. Cardoso's main rival, leftist leader Luiz Inacio Lula da Silva, saw his popularity fall to 23 percent from 25 percent, the poll found. Cardoso's popularity is based on slashing Brazilian inflation from about 3,000 percent when he was elected to about 2 percent today, which has dramatically raised purchasing power among Brazil's poor. Copyright 1998, Reuters News Service

To: md1derful who wrote (7846)	9/11/1998 11:26:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil's Cardoso Extends Lead Over Lula: Ibope Poll Dow Jones Newswires SAO PAULO -- Brazilian President Fernando Henrique Cardoso's has extended his lead over his main opponent 23 days ahead of the presidential election, according to a poll released Friday. The joint poll - by research group Ibope, TV Globo and the O Estado de Sao Paulo newspaper - shows Cardoso's lead over Luiz Inacio Lula da Silva expanded to 24 percentage points from 19 points in last week's survey. If elections were held now, Cardoso would win 47% of the vote, up from 44% in last week's poll, and Lula would garner 23%, down from 25%. Franklin Martins, a political commentator for TV Globo, said Cardoso's rise in the polls could be associated with the deepening of Brazil's financial crisis and voters' belief that the president is more prepared to handle the turmoil than Lula. Other candidates would win 11%. Seven percent of voters would vote blank and 11% were still undecided. Voting is obligatory in Brazil. These numbers give Cardoso re-election in the first round of voting on Oct. 4. To avoid a second-round vote, a candidate must receive an absolute majority of valid votes, which excludes blank ballots. -By Mary Milliken; (55-11) 813-1988; mmilliken@ap.org

To: md1derful who wrote (7846)	9/11/1998 11:28:00 AM
From: Steve Fancy	Respond to of 22640

Brazil's Malan Spokesman: No Split In Govt Over Rate Change Dow Jones Newswires BRASILIA -- The Brazilian government won't change officials or policies in the midst of financial turmoil, Arnolfo Carvalho, a spokesman for Finance Minister Pedro Malan, said Friday. Carvalho was addressing rumors about a possible split in the government after the central bank late Thursday boosted a key interest rate to defend the real. As reported, the central bank's monetary policy committee Thursday decided at an extraordinary meeting to raise the Tban interest rate to 49.75% from 29.75%. "The government wouldn't be so irresponsible as to change ministers now - and, more importantly, to make policy changes," Carvalho said in a telephone interview. The spokesman did acknowledge that "diverging theories are stimulated" within the government, "But once a decision is made, it has been made," he said. -By Geraldo Samor; 55-21-580-9394; gsamor@ap.org

To: md1derful who wrote (7846)	9/11/1998 11:38:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil Faces Key Day After Boosting Interest Rates By GERALDO SAMOR Dow Jones Newswires RIO DE JANEIRO -- Four years of hard-won economic stability will be put to the test Friday, as Brazil wakes up to a trading session that may define whether its currency holds. Dollar and interest rate futures shot higher at Friday's opening, and stocks plunged 2.6% in the early going after the Central Bank, in a surprise move late Thursday night, boosted the interest rate at which it lends to banks to 49.75% from 29.75%. By 1345 GMT, stocks had reversed course and Sao Paulo's Bovespa index was up 3.8%; interest rate futures had also given up some of their early gains. Analysts say the Central Bank felt pressed to take action after the country's foreign-exchange markets posted a net outflow of $1.8 billion Thursday. Since September began, more than $11 billion have left the country, dragging reserves to $52 billion now from $70 billion in early August. The loftiness of the figures is a measure of the turmoil that has engulfed Latin America's largest economy since the year-old Asian financial crisis turned investors attention to Brazil's expanding fiscal deficit and worrisome current-account balance. The decision came just hours after President Fernando Henrique Cardoso told reporters that, if it depended on him, interest rates wouldn't go up any further because they are already too high. Minutes before the Central Bank's announcement, radio stations were still broadcasting those comments, which Cardoso, who's up for re-election Oct. 4, made even as local stock exchanges plunged 15%.

To: md1derful who wrote (7846)	9/11/1998 11:40:00 AM
From: Steve Fancy	Respond to of 22640

Portugal Telecom Sinks To Year-Low On Brazilan Worries By SARAH J. RHYDDERCH Dow Jones Newswires LISBON -- Telecommunications company Portugal Telecom SA (PT) sank to its lowest level since the start of the year earlier Friday as investors continued to punish the stock for its recent Brazilian investments. "It's an overshoot, people are panicking because of Brazil," Pedro Rodrigues, analyst at Titulo brokerage in Lisbon said. "Portugal Telecom is a special case because its Brazilian investments are still fresh in people's minds. Other Portuguese companies have made investments there but aren't being penalized nearly so much." At 1404 GMT, Portugal Telecom was down 550 escudos (PTE) ($1=PTE173.59), or 7.1%, at PTE7,250 on volume of 1.4 million shares. That puts the stock down PTE4,275, or 37%, from its all time high of PTE11,525, reached at the peak of the rally on the Lisbon stock market earlier this year. Earlier in the session, the stock hit a year low of PTE7,001. The renewed downturn was triggered by fresh fears over the financial situation in Latin America. At an extraordinary meeting late Thursday, the Brazilian Central Bank's Monetary Policy Committee decided to raise the Tban Interest Rate, the ceiling rate at which the monetary authority loans money to commercial banks, to 49.75% from 29.75% in attempt to stem the outflow of foreign capital and defend the real. The basic rate, or TBC, was kept at 19%. In July this year, Portugal Telecom paid a $3.01 billion - 226% more than the minimum bid price - for a controlling stake in Telesp Celular as part of the privatization of Brazilian state owned holding Telecomunicacoes Brasileiras SA (TBR) known as Telebras.