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

To: Steve Fancy who wrote (8435)	9/23/1998 1:10:00 PM
From: jan m.	Read Replies (1) \| Respond to of 22640

Steve-- I read this thread every day--took a position in UBB a couple of weeks ago, and appreciate all your postings on current events in Brazil. What do you think will happen to stocks, in Brazil, after the election coming up in a few days? Jan

To: Steve Fancy who wrote (8435)	9/23/1998 1:25:00 PM
From: Steve Fancy	Respond to of 22640

Brazil's net dlr outflow $519 mln Tuesday--traders Reuters, Wednesday, September 23, 1998 at 10:07 SAO PAULO, Sept 23 (Reuters) - Brazil lost $519 million through its foreign exchange markets on Tuesday, in a sign dollars were still steadily flowing out of the country, but at a moderate pace, dealers said. The country's commercial forex market saw a net outflow of $462 million while the floating market saw a net $57 million outflow on Tuesday, they said. The outflow from the floating market was the smallest drainage since August 10, as individuals, who use this market, were confronting difficulty securing dollars at banks to send them outside of Brazil, dealers said. In comparison, commercial and floating forex markets lost a total $518 million on Monday. Daily dollar outflows have been averaging $500 million since last week, down from a $1.5 billion per day earlier in the month. As of Tuesday, a total $16.267 billion had fled the country through its forex markets so far this month. In August, Brazil lost $12 billion. Brazil's foreign currency reserves currently stand below $50 billion, down from about $70 billion at the start of August. At their peak in April, reserves stood at $73.8 billion. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:26:00 PM
From: Steve Fancy	Respond to of 22640

BRAZIL-ECONOMY =2 BRASILIA Reuters, Wednesday, September 23, 1998 at 10:07 Cardoso also called on the G7 group of industrialized nations to provide funds to the International Monetary Fund to create a "contingency fund" to fend off a financial crisis in Latin America. "We are not afraid...to have intensive talks with partners and international institutions like the Monetary Fund, the World Bank and the Inter-American Development Bank," he said. Cardoso said reforming Brazil's pension system, which has a defict of more than $20 billion, was central to slashing the budget deficit. He said Congress would take up the issue next month. "The reform will be voted (in Congress) by October," Cardoso said. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:27:00 PM
From: Steve Fancy	Respond to of 22640

Cardoso's lead narrows in Brazil opinion polls Reuters, Wednesday, September 23, 1998 at 10:08 SAO PAULO, Sept 23 (Reuters) - Brazilian President Fernando Henrique Cardoso has lost support ahead of Oct. 4 elections but is still likely to win in the first round of voting, an opinion poll showed Wednesday. The nationwide Ibope poll showed 47 percent of those surveyed would vote for Cardoso, down from 49 percent in a previous poll. Despite the slip, Cardoso was still seen winning more votes than all of his opponents combined, which would ensure a first round victory. His main opponent, left-wing leader Luiz Inacio Lula da Silva, garnered 24 percent, up from 22 percent in a poll a week ago. The latest poll surveyed 3,000 voters across Brazil between September 17 and 21. It was released in leading newspapers on Wednesday morning. No margin of error was given. The reform-minded Cardoso has gained in recent surveys because voters say they consider him the best candidate to tackle the financial turbulence plaguing the country. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:28:00 PM
From: Steve Fancy	Respond to of 22640

Brazil Bovespa had big foreign outflow Sept 1 - 20 Reuters, Wednesday, September 23, 1998 at 10:08 SAO PAULO, Sept 23 (Reuters) - The Sao Paulo stock exchange (Bovespa) said Wednesday it saw a net 1.374 billion reais worth of foreign investment leave the bourse in the first 20 days of September. Foreign buys during the period totalled 1.542 billion reais, while foreign sales amounted to 2.916 billion reais, the exchange said. The figures resulted in accumulated net foreign outflows of 1.878 billion reais so far this year. Market players attributed the big outflow to investors fleeing from Brazilian stocks amid persistent worries about the country's economic outlook. The bourse had posted a foreign net capital outflow of 1.724 billion reais in August, after posting a net inflow of 423 million reais in July. ($1=1.18 reais) Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:29:00 PM
From: Steve Fancy	Respond to of 22640

Brazil shares seen rising, tracking global markets Reuters, Wednesday, September 23, 1998 at 10:08 SAO PAULO, Sept 23 (Reuters) - Brazilian shares were seen rising on Wednesday, tracking gains in bourses around the globe and on speculation that international agencies are mounting a support package, traders said. "Gains in international markets are a positive sign for Brazil," said a fund manager at Banco Marka. Stocks in Asia and Europe rose Wednesday and Wall Street was set open higher as investors awaited Federal Reserve Chairman Alan Greenspan's address to the Senate. On Tuesday, Sao Paulo's key Bovespa (INDEX:$BVSP.X) index inched up 1.71 percent to 6,560. Traders are eager to learn if Greenspan indicates a rate cut in the U.S. during his address, set for 1500 local time. In Brazil, investors also awaited a speech by President Fernando Henrique Cardoso which they said could include reference to an international aid package. "We're not going to see big gains or a return of volume in stock trading in Brazil until we get some details about the support package," a trader at a local brokerage said. A sharp rise in interest rates to almost 50 percent, and speculation that international agencies could lend Brazil money, helped stabilize Brazil's rocky markets earlier this month. A concrete package still has not been announced, however. Cardoso was expected to talk about how Brazil will fend off the crisis at a public event in Brasilia today. Bluechip activity Tuesday: Telebras receipts (SAO:RCTB40) up 1.56 pct at 84.80 reais Petrobras (SAO:PETR4) up 2.59 pct at 119 reais Eletrobras (SAO:ELET6) up 7.93 pct at 24.50 reais Vale do Rio Doce (SAO:VALE5) off 2.7 pct at 18 reais Bovespa: * Tuesday: up 1.71 pct at 6,560 * Week: off 2.2 pct * Month: up 1.3 pct * Year-to-date: off 35.6 pct SELIC (open): 4.02 pct Dollar/Real (open): 1.1840 per dollar YESTERDAY'S STORIES 1/8 1/4SUR 3/8 ***** SPOT REAL QUOTES <BRBY> BOVESPA STOCK INDEX (INDEX:$BVSP.X) ELECTRICAL ENERGY INDEX <.IEE> BRAZILIAN ADR PRICES <BR/ADR> BRAZILIAN BRADY BOND PRICES <2LDO> BRAZILIAN DOLLAR FLOW HISTORY <BRFLOW> Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:31:00 PM
From: Steve Fancy	Respond to of 22640

Brazil Cardoso asks for fund to fend of Latam woes Reuters, Wednesday, September 23, 1998 at 10:08 SAO PAULO, Sept 23 (Reuters) - The G7 group of industrialized nations should provide funds to the International Monetary Fund to create a "contingency fund" to fend off a financial crisis in Latin America, Brazilian President Fernando Henrique Cardoso said Wednesday. "We are not afraid...to have intensive talks with partners and international institutions like the Monetary Fund, the World Bank and the Inter-American Development Bank," Cardoso said in a speech in Brasilia. "If an understanding with these institutions were in the interest of the country we would do it," Cardoso said. "I am convinced that the G7 countries and the above-mentioned institutions should provide sufficient funds to the Fund to be used in the event that it is needed by Latin America," Cardoso said. He also promoted the creation of "a kind of contingency fund that would be used to prevent crises." Cardoso also said that the government will send its fiscal reform proposal to Congress by the end of the year and that it will draw up a labor reform proposal in November. Brazil's nominal budget deficit has ballooned to almost 8 percent of gross domestic product, making it the biggest headache facing Cardoso after Oct. 4 elections, which he is expected to win in a first round of voting. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:32:00 PM
From: Steve Fancy	Respond to of 22640

Brazil shares up on global factors, ignore Cardoso Reuters, Wednesday, September 23, 1998 at 10:59 SAO PAULO, Sept 23 (Reuters) - Brazilian shares opened higher Wednesday due to global factors, while a speech by President Fernando Henrique Cardoso did not have an immediate effect on the market, traders said. "The speech was good, but I don't think it should have a great impact on the market," one trader said. "We already knew what he was talking about. What is needed now is action." The Bovespa (INDEX:$BVSP.X) index of leading shares climbed 2.64 percent to 6733 points at 1030 local time/0930 EDT/1330 GMT, most of that gain posted before Cardoso's televised speech. A positive trend on Wall Street and speculation that international agencies were mounting a support package for Brazil were the main supporting factors for the market. Traders said Cardoso's speech might have had more influence if he had made a concrete reference to such a package, traders said. "The market already knew that he (Cardoso) was not going to take a strong stance before the election. For that reason, there wasn't a lot of attention paid to the speech," another local dealer said. Wall Street started strong as investors awaited Federal Reserve Chairman Alan Greenspan's address to the Senate. The markets were looking for a signal that the Federal might cut U.S. interest rates. Brazil was expected to track the trend in outside markets throughout the session. Cardoso did not confirm that aid was forthcoming, but said the G7 group of industrialized nations should provide funds to the International Monetary Fund (IMF) to create a "contingency fund" to fend off a financial crisis in Latin America. Telebras receipts (SAO:RCTB40) led the market gains, rising 3.07 percent to 87.40 reais at 1115 local time/1015 EDT/1415 GMT, and accounted for well over 50 percent of total trade. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8435)	9/23/1998 1:34:00 PM
From: Steve Fancy	Respond to of 22640

REPEAT:Brazil Cardoso:Crisis Makes Fiscal Adjustment Urgent Dow Jones Newswires BRASILIA -- Amid continuing tension in the financial markets and with less than two weeks before elections, Brazilian President Fernando Henrique Cardoso stressed his commitment to attacking the fiscal deficit quickly and opening the way for new economic growth. Cardoso took advantage of an annual awards event to discuss Brazil's response to the international financial crisis, saying that the difficulties have made the need for fiscal austerity in Brazil "more urgent." He said all levels of government are overly indebted, but stressed that state governments in particular must be more responsible with their money. "The losses have to stop," Cardoso said. "The state has to use only the resources that society can pay for." Brazil is currently running a public sector deficit equal to 7.3% of gross domestic product (GDP). Cardoso stressed the importance of gaining the confidence of Brazil's neighbors and investors with a firm stance on fiscal austerity. "It is a commitment not only to those who invest in Brazil but also to other countries, especially in Latin America, who like us are trying to make internal adjustments and build up strength to weather external storms," Cardoso added. Since Russia devalued its currency and defaulted on its debt in mid-August, Brazil's stability has been shaken by the loss of confidence in emerging markets and a strong outflow of capital. The country's reserves have fallen below $50 billion from the $70 billion posted at the end of July. For more than two weeks, top U.S. government, International Monetary Fund and World Bank officials have pledged their support for Brazil's economy and suggested that a financial aid package could be pulled together to help Brazil meet its debt obligations. Cardoso said the Group of Seven leading industrial countries "should give the IMF sufficient funding to be used in case of need in Latin American countries and a type of contingency fund that would seek to prevent crises." He made no reference to the size or the timing of such a contigency fund. "We will continue to maintain a mature, open and sovereign relationship with the institutions," Cardoso said in reference to the IMF, World Bank and the Interamerican Development Bank and the Bank for International Settlements. Cardoso said that Brazil needs to be more fiscally responsible as foreign financing resources are shrinking owing to the current market turmoil. The president reaffirmed his commitment to put forward a three-year fiscal adjustment plan, saying that the fiscal reform process must be completed in a "rapid, decisive, and definitive manner." Cardoso said that the government plans to raise more revenues by cracking down on tax evasion and broadening the taxpayer base. He said that congressional leaders are also committed to voting on and promulgating reforms as soon as possible. He said that a landmark social security reform bill should go through a final vote in October, while the government will present a tax reform proposal to Congress in November. Cardoso also said that he will "do everything possible to protect the real." He added, however, that he hopes Brazil can cut interest rates as soon as possible so economic growth can resume. In an effort to prevent a collapse of the real and stem heavy capital outflows, the government on Sept. 10 raised the rate at which the central bank lends to banks, known as the Tban, to 49.75% from 29.75%. The president said that economic growth is "indispensable" for job creation, which he characterized as a top national priority. Brazil's unemployment rate is around 8%, its highest level since Cardoso took office four years ago. Cardoso is expected to win a second term in the Oct. 4 elections. The latest poll gives him 47% of the vote, while top challenger Luiz Inacio Lula da Silva has 24%. -By Mary Milliken and Stephen Wisnefski; (5511) 813-1988

To: Steve Fancy who wrote (8435)	9/23/1998 1:37:00 PM
From: Steve Fancy	Read Replies (3) \| Respond to of 22640

Emerging Mkts ADRs: Rally On Improved Global Sentiment Dow Jones Newswires NEW YORK -- Emerging market shares trading as American depositary receipts continue to rally Wednesday, as sentiment improves in markets world-wide, traders said. A dealer said the thin volumes that have plagued emerging markets for months are aiding the rebound. "Basically there's a lack of liquidity, so markets are really pushing up," he said. Traders couldn't narrow down to specific causes for the market recovery. "Everything is well supported, both locally and in ADRs," a dealer said. "Risk has disminished somewhat." Brazilian ADRs are climbing solidly. Traders said that market participants didn't pay too much attention to an address by President Fernando Henrique Cardoso earlier Wednesday. "I didn't follow it closely, but the overview is positive," he said. Brazilian bellwether Telebras rose 6.4% to $76 7/16 at 1515 GMT, while Telebras HOLDRs advanced 5.3% to $77 1/2. Oil-related stocks were getting an extra boost Wednesday thanks to a firmer price of crude. Argentine YPF advanced 5% to 26 1/4 and Mexico's TAMSA soared 8.9% to $8 7/16. Venezuela's CANTV rose 3.1% to $14 3/8. Among Mexican issues, Empresas ICA jumped 12% to $6 9/16, outperforming the country's fellow ADRS. The engineering and construction company Wednesday said it paid down $150 million in debt. It also said it received around $300 million from the government from a toll-road rescue plan and announced it increased tenfold its share buy-back program. Asian ADRs were mostly higher, although PT Telekomunikasi Indonesia was flat at $3, despite a stronger close in Jakarta on the back of a sovereign debt rollover agreement. -By Margarita Palatnik; 201-938-2226; margarita.palatnik@cor.dowjones.com