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

To: Steve Fancy who wrote (9406)	11/4/1998 1:34:00 PM
From: CuttotheCore	Respond to of 22640

<<TBR is sitting just under that magic 83 number that we used to talk about so much...interesting.>> Just over and looking oh so good, if you don't want to re-incur the pain, remember to put in your stops! Best, stx

To: Steve Fancy who wrote (9406)	11/4/1998 1:38:00 PM
From: Steve Fancy	Respond to of 22640

Brazil shares race up ahead of key Congress vote Reuters, Wednesday, November 04, 1998 at 13:07 SAO PAULO, Nov 4 (Reuters) - Brazilian stocks raced up in afternoon trade Wednesday as more optimism spread in the market ahead of a key reform vote in Congress later today, traders said. The key Bovespa index (INDEX:$BVSP.X) jumped 3.24 percent to 7,753 at 1525 local time/1225 EST/1725 GMT after wallowing in the positive zone for most of the morning session. The Bovespa's gains were also underpinned by a powerful rally in the Dow Jones industrial index (INDEX:$INDU), traders said. The Dow was up 122 points at 8,829. "The market is cheering the prospects of the Congressional vote and a higher Dow Jones," said one local trader. The lower house of Congress will vote on the final three opposition amendments to the country's long-delayed social security reform bill. Voting will start no earlier than 1700 local time/1400 EST/1900 GMT, Congressional sources said. Earlier in Brasilia, Social Security Minister Waldeck Ornelas said the government has just enough support to defeat the amendments. The pension reform bill is crucial to the government's efforts to stem a deficit in Brazil's public and private sector pension systems, which is set to top $35 billion this year. The result of today's vote is also important as it could be a precursor of the government's chances in getting its budget cuts passed in Congress. The government announced last week it will save $84 billion over the next three years as a prerequisite to securing financial backing from the International Monetary Fund (IMF). Among Sao Paulo's blue chips, Telebras preferred receipts (SAO:RCTB40) rose 2.71 percent to 98.60 reais, while Petrobras preferred (SAO:PETR4) jumped 4.6 percent to 171.30 reais. noriko.yamaguchi@reuters.com)) Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (9406)	11/4/1998 1:39:00 PM
From: Steve Fancy	Respond to of 22640

Telecom Deregulation Pushes Brazil Toward Brave New World By MARGARITA PALATNIK Dow Jones Newswires NEW YORK -- The timing of Brazil's communications sector deregulation coupled with recent technological advances place the country at the edge of a brave new world. Or so hope many U.S. executives who have descended on Sao Paulo for the Expo Comm Brasil '98 and Networld-Interop trade shows going on this week. Companies bringing their view of a world where telephone, cable signal and Internet service travel through a single network include U.S. heavy-weights like Lucent Technologies, Novell Inc. and Cisco Systems. What has these executives salivating and polishing up their Portuguese is the recent split-up and privatization of former monopoly Telecomunicacoes Brasileiras SA (TBR) and the impending award of four licenses - three for fixed wireline, plus one for long-distance - being likened to Competitive Local Exchange Carriers, or CLECs, which have recently proliferated in the U.S. U.S. technology firms see billions of dollars to be allocated to capital expenditure as dozens of companies build their networks, expand, or replace obsolete infrastructure. And they are ready to evangelize. "The dilemma for these new companies is, 'Do we invest in a traditional-style network, known to work, but which we sense may be reaching the end of its natural life, or do we go for the new technology, which is scary because it's not so understood, but which would give us a jump on the competition?'", said Cisco Systems marketing vice president Larry Lang during a telephone interview. To put things in context, Brazil is facing in one shot a process that took almost two decades and happened in two waves in the U.S. "In the early '80s, when when the U.S. deregulated telecommunications, Internet Protocol was a science project. Nobody had heard of the Internet," Cisco's Lang said. Thus, new entrants like MCI Communications (WCOM) and Sprint Corp. (FON) began to compete using virtually the same technology used by incumbent AT&T (T), Lang added. Most recently, a new crop of upstarts like Quest Net (QNETD, QNET), Level 3 Communications Inc. (LVLT) and Enron Corp. (ENE) subsidiary Enron Communications have started to build fiber optic "backbone", or main pipe, in the hopes of carving their niches thanks to the much-talked-about convergence. So while in the developed world there were two waves of new entrants, "in Brazil you have the two trends at the same time. It kind of creates a double excitement level," Lang said. For example, he adds, the winner of a mirror license concession could charge consumers $20 or $30 a month for the telephone, another $20 or $30 for cable, plus another $20 for Internet. "Right now, the bidders for the mirror companies are going through their courtship rituals, to see who will partner up with whom," he added. "But the potential consortia are looking at this technology very seriously." On the other hand, the "established companies are realizing that the future competitors are coming on strong, so they don't want to wait until (the new CLECs) build their networks." Cisco hopes to cash in with its packet technology, the equipment which can bring together the telephone, cable and data networks. The company enjoys a 50% global market share, with about half its revenues generated outside the U.S., Lang said. "People are gathering up their courage, realizing that the new world networks are the way to go," the executive said. "Ultimately it's the business driver. Growing pains are a little frustrating with new technologies, but the economics are very compelling." -By Margarita Palatnik; 201-938-2226; margarita.palatnik@cor.dowjones.com

To: Steve Fancy who wrote (9406)	11/4/1998 1:42:00 PM
From: Steve Fancy	Respond to of 22640

Welfare reform voting still pushing local stocks up Local stocks are expected to continue trading higher for the third consecutive day as investors are confident that Congress will approve later in the day three outstanding points in a landmark Social Security reform bill. The approval of the bill, which is expected to save the government R$ 4bn, has been considered a key point as it is expected to show how successful the government will be in pushing through the measures proposed last week as part of a three-year austerity plan, the Fiscal Stabilization Program, known as (PEF). The question which will be answered throughout the day is to what extent Brazil can deliver on its austerity plan. "The market has shown it believes the government will get the reforms approved," a dealer told Dow Jones this morning. However, the US-based weekly economic magazine, Business Week, pointed out on its current edition that the approval of the bill will also depend on "the support of Brazil's unruly state governors, who are practiced in the art of trading political influence for pork-barrel projects and other benefits from the federal government." According to the magazine, President Fernando Henrique Cardoso will have to "convince the governors that it's in their self-interest, as key players in Brazil's federal system, to be part of the solution instead of the problem". And Cardoso has already begun to do that by classifying fiscal package detractors as demagogues, see related story. But most of all, today is definitely the government's "D-Day" because, market watchers explains, foreign investors should only return to the domestic market when words become actions. (By Paulo R. Monterio Dias)