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

To: Tundra who wrote (8814)	10/5/1998 3:05:00 AM
From: Steve Fancy	Respond to of 22640

Brazil's Cardoso Has 50.2% W/Half Of Districts Reporting Dow Jones Newswires BRASILIA -- With just over half of all districts reporting, Brazilian President Fernando Henrique Cardoso continues to hold a commanding lead in his bid for reelection. At 0605 GMT, or ten hours after polls closed, Cardoso had 50.2% of all valid votes while leftist challenger Luiz Inacio da Silva had 35.2%, the federal Electoral Court said. While Cardoso's lead has narrowed slightly from earlier tallies, the latest results would still give the incumbent candidate a victory in the first round. Cardoso must receive an absolute majority of valid votes, excluding blank ballots, to avoid a run-off election on Oct. 25. An early exit poll by the respected Ibope research group gave Cardoso 56% of the vote, while Lula had 29%. Analysts said that exit polls were a more reliable indicator of the final results than the incomplete official returns. The final official result isn't expected to be known until late this week. Voting is mandatory in Brazil for the 106 million eligible voters between the ages of 18 and 70. However, in the latest tally, 11.8 million of those eligible had abstained from voting. -By William Vanvolsen and Stephen Wisnefski; +55-11-813-1988

To: Tundra who wrote (8814)	10/5/1998 3:07:00 AM
From: Steve Fancy	Read Replies (11) \| Respond to of 22640

WRAP: Brazil's Cardoso Set To Win Reelection In 1st Round Dow Jones Newswires -By Stephen Wisnefski and Mary Milliken SAO PAULO (Dow Jones)--Brazilian President Fernando Henrique Cardoso is headed for a first-round victory in his bid for a second term in office, setting the stage for four more years of free-market economic policy and reform. Cardoso, who would be the first Brazilian president to be democratically reelected, won 56% of the vote in Sunday's election according to Ibope's exit poll, while leftist challenger Luiz Inacio Lula da Silva garnered 29%. At 0600 GMT, or 10 hours after polls had closed, official returns gave Cardoso just over 50% of the valid votes, with half of all voting districts reporting. But analysts consider the exit polls to be a more credible indicator. A first-round victory for Cardoso had been a foregone conclusion for weeks. A recent rise in the opinion polls coincided with an erosion in investor confidence in Brazil, as voters believed him to be the only candidate capable of dealing with the complexities of global financial turmoil. "In reelecting Cardoso, voters clearly demonstrated their confidence in his political leadership and his ability to steer Brazil through the world financial crisis," said Carlos Esteban Martins, a political scientist at the University of Sao Paulo. "Voters showed they were unwilling to rock the boat with a change in leadership," Martins added. "Cardoso has shown during is four years in office that he knows exactly where he wants to go and that he is unwilling to change course and this was a message voters wanted to hear." Cardoso, 67, is the father of an economic stabilization program, known as the Real Plan, that has cut Brazilian inflation from over 2,400% in 1994 to around zero in 1998 and attracted unprecedented levels of foreign investment. Cardoso's commitment to protecting the currency, the real, and promoting economic growth has made him the candidate of choice for financial markets and foreign governments. Brazilian Finance Minister Pedro Malan's announcement of the exit poll results at an International Monetary Fund seminar in Washington D.C. Sunday was greeted with applause from the audience, which consisted mostly of bankers and delegates to the annual IMF-World Bank meeting. In spite of the enthusiasm in Washington, Cardoso's victory isn't expected to have a big impact on local markets. "I wouldn't call this good news for the financial markets because it was largely expected. But it is an alleviation." said Mauro Schneider, chief economist at ING Barings in Sao Paulo. With Brazil awash in a market crisis that has sent investors fleeing and pushed the country's foreign reserves to below $50 billion from over $70 billion at the end of July, market watchers said they are awaiting an indication that Cardoso can keep the current mire from deepening. In a bold pre-election move two weeks ago, Cardoso pledged to attack the country's burgeoning public deficit of over 7.3% of gross domestic product by implementing a three-year fiscal adjustment plan. Late Sunday, presidential spokesman Sergio Amaral said no austerity measures would be announced this week. Market watchers said they expected such a cautious approach. "How specific the government is in its measures will depend on how the markets behave this week, and not just in Brazil," Schneider said. "If the situation is under control, there shouldn't be any concrete measures." Analysts believe it's too early to tell how global financial markets will perform this week, noting that investors nerves could be frayed by a downturn in U.S. stocks, a new crisis in Japan or more losses in Brazilian reserves. "If the market reacts nervously...then I think the government would have to move everything up," said ING's Schneider, referring to fiscal measures. Regardless of when they come, the austerity measures are considered an essential condition for an eventual credit line, reportedly worth up to $30 billion, from international lenders. Brazil's Foreign Affairs Minister Luiz Felipe Lampreia said Sunday in Brasilia that Cardoso's victory would strengthen the country's position in negotiations with the IMF and other international multilateral lenders. The government's calendar could also be affected because some key state gubernatorial races won't be decided until a second round vote later this month. Cardoso has placed much of the blame for bloated public accounts on state governments, and he won't be able to map out a complete fiscal strategy until the local races are decided, analysts said. Aside from president, Brazilians elected 513 federal deputies, 27 senators, 27 state governors and 1,045 state deputies on Sunday. In Sao Paulo, Brazil's wealthiest and largest state with 34 million inhabitants, incumbent governor Mario Covas was trailing populist Paulo Maluf and Workers' Party candidate Marta Suplicy. But Maluf had just 34% of the votes to 24% for Suplicy and 23% for Covas, of the valid votes counted thus far, meaning the Sao Paulo race won't be decided in the first round. Analysts said the markets would welcome Covas' survival to the second round after polls showed him struggling. The governor, who is from Cardoso's party, has cleaned up the state's finances, privatized key energy assets and embraced foreign investors. -By Stephen Wisnefki and Mary Milliken; (5511) 813-1988