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

To: Steve Fancy who wrote (11278)	1/7/1999 5:33:00 AM
From: Tony van Werkhooven	Read Replies (1) \| Respond to of 22640

Steve- on a brighter note- I was surprised at the lopsided vote on the check tax. That may be a good omen on the other votes in the senate. Hopefully, a majority can be mustered in the chamber of Deputies. Fernando- at this point, what is your sense about the Chamber of Deputies. On the debt- they just don't seem to get it. "Default" to the federal gov. or whatever you want to call it should not be allowed to work. "They" will pay for it in higher rates for an extended period. Hopefully, the federal government will solve this by flatout saying that they will withold amounts overdue from transfer payments. OT- It is interesting to see how difficult it is to create fundamental change in a democracy - particularly a multiparty environment in which many politicians are looking out for #1. This is not limited to Brazil,look at the USA for example and how it has dealt with SS in the past. Chile imposed its current economic environment under Pinochet pretty much as a package with assistance of some U. of Chicago economists. In the long run, probably less painfull the the extended process that Brazil is undergoing. Before someone flames me on Pinochet- I just want to say that whatever jail time Pinochet gets, it is not enough to pay for the horror he fostered. Tony

To: Steve Fancy who wrote (11278)	1/7/1999 8:21:00 AM
From: David Petty	Respond to of 22640

These guys are crazy... Brazil sneezes and the world gets a cold...I think some of these Brazilian leaders get their kicks on seeing who can cause the most reaction... Brazil's Woes Hurt Market BANGKOK, Thailand -- Shares slipped Thursday, shedding earlier strong gains, after news broke out that a state in Brazil declared a 90-day moratorium on debt payments to the federal Brazilian government. The Stock Exchange of Thailand Index fell 4.84, or 1.2%, to 397.72. About 676.1 million shares worth 10.6 billion baht changed hands, compared with 760.5 million shares worth 12.07 billion baht Wednesday. Declining shares outnumbered advances 134 to 101, excluding shares reserved for foreign investors. Analysts said news that the Brazilian state of Minas Gerais declared a 90-day moratorium on debt payments caused the U.S. dollar to lose strength and triggered selling of Thai stocks in the afternoon. Other analysts said the Thai market and others in the region can fall further Friday if the New York stock market suffers big losses overnight because of the developments in Brazil. Trade in banking shares was active, but the sector ended down 3%. Analysts said banks had been overbought recently. Bangkok Bank ended down 0.50 baht to 55.50 baht. Krung Thai Bank eased 1.50 baht to 21.25 baht. Thai Farmers Bank was the only bank stock that rose Thursday, advancing 0.50 baht to 58.50 baht. In the building sector, Siam Cement shed 48 baht to 624 baht. Advanced Info Service slipped 4 baht to 266 baht despite the announcement that Singapore Telecommunications has acquired a 20% stake for about 11.6 billion baht in the Thai telecom company. But the transport sector jumped 5.9% after missing out on the recent market rally. Thai Airways International surged 5 baht to 62 baht.

To: Steve Fancy who wrote (11278)	1/7/1999 12:49:00 PM
From: Steve Fancy	Respond to of 22640

Brazil shares tumble 3 pct at open Reuters, Thursday, January 07, 1999 at 08:27 SAO PAULO, Jan 7 (Reuters) - Brazilian shares tumbled 3 percent in the first few minutes of trading Thursday after Minas Gerais state declared a moratorium on its debt with the central government, traders said. Sao Paulo's key Bovespa index (INDEX:$BVSP.X) slumped to 7,110 amid a wave of profit-taking after an 8 percent rise over the last three sessions. The debt moratorium sparked concerns that support for the government's anti-crisis plan could wane, making it difficult to get unpopular tax hikes and other measures through Brazil's unruly lower house of Congress. Brazil's benchmark C-Bond emerging debt was down 0.625 at 58.625 after sharp declines Wednesday as well. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11278)	1/7/1999 12:55:00 PM
From: Steve Fancy	Respond to of 22640

Brazil shares fall more on state debt moratorium Reuters, Thursday, January 07, 1999 at 09:36 SAO PAULO, Jan 7 (Reuters) - Brazilian shares extended their losses by Thursday's midday trade after Minas Gerais state declared a moratorium on its debt with the federal government on Wednesday, traders said. The market's blue-chip Bovespa index (INDEX:$BVSP.X) was down 6.06 percent to 6,887 points, with bellwether issue Telebras preferred receipt (SAO:RCTB40) losing 7 percent to 91.7 reais. Minas Gerais governor Itamar Franco said late on Wednesday his state had an "absolute lack of money" to make payments on some 18 billion reais ($15 billion) on debt. "What we're seeing is the Itamar effect," a trader at Banco Credibanco in Sao Paulo said. "This complicates the fiscal situation because of less revenue (for the central government) from states." Meanwhile, in the debt market, Brazil's benchmark C-bonds traded overseas was down 1.0 at 58.25. sao.paulo.newsroom@reuters.com)) Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11278)	1/7/1999 12:57:00 PM
From: Steve Fancy	Respond to of 22640

Emerging mkt bonds slide on Brazil political feud Reuters, Thursday, January 07, 1999 at 09:49 NEW YORK, Jan 7 (Reuters) - Emerging market bond prices slid early Thursday in the New York trading session as traders tried to assess the political fallout of a 90-day debt moratorium announced by a large Brazilian state. Benchmark Brazil "C" <BRAZILC=RR> bonds dropped 3-5/8 to 58-1/8. The decline in other emerging market bond prices was less severe. Argentina discount bonds <ARGDIS=RR> fell 2-1/4 to 75-3/4s. Itamar Franco, governor of Minas Gerais, said in a statement late Thursday that the Brazilian state would observe a 90-day moratorium on debt payments to the central government. Wall Street traders sold Brazilian debt and other emerging market bonds early Thursday, driving prices lower. "Going into the New Year, Wall Street had started to get long in anticipation that clients would buy in January. With the euro going well, the Street got even longer," said Paul Dickson, sovereign bond strategist at Lehman Brothers Inc. "Clients did not come calling in huge size in the first days of this year. When the headline hit yesterday (Wednesday) with the words 'moratorium,' traders started selling," said Dickson. The remote possibility of a debt moratorium of any sort is anathema to emerging market bond traders, burned from losses from a debt default by Russia last summer. Analysts said the suspension of payment announced by Franco, a former president of Brazil and a heavyweight political figure, is more likely political jockeying. The government of President Fernando Henrique Cardoso responded harshly to the threat from Franco, in turn threatening to halt transfer of funds to Minas Gerais, Brazil's third richest state. A political feud is the last thing that Brazil needs as it struggles to restore international investor confidence with a broad fiscal adjustment program, analysts said. In a research note to clients Thursday morning, Goldman Sachs analyst Paolo Leme was quoted saying the debt moratorium from Minas Gerais "adds significant risk in Brazil." Emerging market traders also took their cue from falling Brazilian stocks. The Bovespa was down more than six percent early Thursday. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11278)	1/7/1999 1:10:00 PM
From: Steve Fancy	Respond to of 22640

World Bank approves $1 bln in loans for Brazil Reuters, Thursday, January 07, 1999 at 12:39 WASHINGTON, Jan 6 (Reuters) - The World Bank's board approved loans totalling more than $1 billion for Brazil on Thursday, a bank spokesman said. The loans, a $758 million "social security" loan and a $253 million credit for social protection programs, are designed to help Brazil's poor weather the current economic turmoil. They form part of the World Bank's $4.5 billion contribution to a $41.5 international rescue package for Brazil approved last year. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11278)	1/7/1999 1:18:00 PM
From: Steve Fancy	Read Replies (10) \| Respond to of 22640

ADR REPORT - ADRs hit by profit-taking, Brazil Reuters, Thursday, January 07, 1999 at 11:25 By Ian Simpson NEW YORK, Jan 7 (Reuters) - American Depositary Receipts (ADRs) slipped overall Thursday amid profit-taking and worries about Brazil's economy. Dealers said the drop was to be expected after U.S. and European markets roared higher Wednesday. The start of President Bill Clinton's impeachment trial in the Senate also weighed on the U.S. dollar. The currency moved higher through the morning to trade at 111.28 bid against the yen. "Some stocks are just giving up some of the ground they've gained over the last few days, which was a lot," said Jim Brophy, with ADR research at BT Alex. Brown. The Bank of New York index of 445 leading ADRs <.BKADR> was off 1.84 percent. The Dow industrials (INDEX:$INDU), which notched up a 2.51 percent gain Wednesday, slipped 48 to 9496 points in late-morning trade. Worries about Brazil, Latin America's biggest economy, also sent shudders through markets around the world. The governor of Minas Gerais, Brazil's third-biggest state, declared a 90-day moratorium on debt payments to the federal government. The move is seen as weakening support for key fiscal reforms aimed at raising $23.5 billion mandated by an international loan agreement last year. The dispute over debt "will show whether the federal government is going to keep a close tab on things," a trader said. Bellwether Brazilian telephone issue Telebras SA (SAO:TELB4) (NYSE:TBH) was off 1-7/8 to 76. Telephone company Telesp Par (NYSE:TSP) slipped 7/8 to 21-1/2. The ING Barings Latin American index of leading regional stocks <.LAT> was off 2.3 percent. European telecommunications ADRs gave up some of the strong gains they registered Wednesday. Finland's Nokia Group (HELS:NOKS.A) (NYSE:NOK.A) eased 2-8/16 to 138-15/16. Telefonica de Espana (MADRID:TEF) (NYSE:TEF), which has major investments in Brazil and other Latin American countries, was off 10-1/8 to 153-1/2. British mobile phone company Vodafone Group Plc (ISEL:VOD) (NYSE:VOD) was off 5-1/4 to 175-1/2. The drop came after a report that U.S. group MCI WorldCom Inc. (NASDAQ:WCOM) planned to top Vodafone's estimated $55 billion offer for U.S. wireless concern AirTouch Communications Inc. (NYSE:ATI). ADRs allow U.S. trade of foreign shares. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11278)	1/7/1999 2:19:00 PM
From: Steve Fancy	Read Replies (4) \| Respond to of 22640

Brazil Chase Manhattan Unit Buys Local Banco Patrimonio Dow Jones Newswires SAO PAULO -- Banco Chase Manhattan SA, a unit of the Chase Manhattan Corporation (CMB), announced Thursday it will acquire substantially all of the business of local Banco Patrimonio de Investimento SA. Terms of the transaction weren't immediately disclosed. Under the agreement, the acquisition doesn't include the bank through which Patrimonio has conducted its business or the private equity business, although Chase will acquire all rights to the Patrimonio trademark. "With this transaction, Chase is positioned to become the leading investment bank in Brazil and a market leader in all major wholesale financial products," William Harrison, vice chairman of the Chase Manhattan Corporation said in a written statement. "Our acquisition of Patrimonio also underscores Chase's long-term commitment to Brazil, to Latin America and to emerging markets in general." The transaction, which is subject to regulatory approval, is expected to be completed by the end of the first quarter. Later at a press conference, Banco Chase president and CEO Patrick Morin said the objective of the acquisition "is very clear": "Chase wants to increase its market share in investment banking." "Patrimonio is known as a strong and active player in investment banking, and Chase will be incorporating a very solid team of professionals," he said. Chase and Patrimonio would rather call the transaction announced Thursday as a "merger agreement, since both teams will merge." For instance, Patrimonio's current president, Jair Ribeiro, will become chief operating officer of Banco Chase. "Chase actually bought Patrimonio, but not its legal registration with Brazilian authorities," explained Ribeiro. "In practical terms, Chase bought everything - our clientele - but our cash flow," he added. Morin said he informed Central Bank president Gustavo Franco of the acquisition Wednesday, and that government approval is likely - but not official yet. Ribeiro said Banco Patrimonio's net equity currently stands at some 85 million reals (BRR) ($1=BRR1.20). Chase's net worth in Brazil amounted to BRR263 million in end-November. Each of the institutions manage a total $1.3 billion worth of third-party assets.

To: Steve Fancy who wrote (11278)	1/7/1999 2:20:00 PM
From: Steve Fancy	Respond to of 22640

REPEAT:Brazil Govt Statement On State Debt Later Thu-Estado Dow Jones Newswires RIO DE JANEIRO -- Brazil's Finance Minister Pedro Malan said the Finance ministry will make a statement later Thursday on the Minas Gerais state debt moratorium, the Estado news agency reported. Questioned by journalists on leaving a meeting at the Foreign Affairs ministry, Malan limited himself to saying, "we will speak about this later today (Thursday)." On Wednesday Minas Gerais state governor Itamar Franco suspended federal debt payments for 90 days, starting Jan. 1 of this year. The state's federal debt stands around $15 billion, to be paid in monthly installments of $67 million over a 30-year period.