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

To: David Petty who wrote (11666)	1/14/1999 12:42:00 PM
From: Steve Fancy	Respond to of 22640

David, I'm watching closely for any news on outflows today. If you catch it before me, please post. Usually seem some speculation between 1 and 2 EST. sf

To: David Petty who wrote (11666)	1/14/1999 12:42:00 PM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil/Public Deficit/Debt -3: Fiscal Goal Review Possible Dow Jones Newswires The accumulated nominal public deficit for the first 10 months of 1998 stands at BRR56.39 billion, compared with BRR34.21 for the same year-earlier period. Commenting the public deficit figures, Central Bank economic policy director Altamir Lopes said that he was confident that the 1998 projection of a deficit of BRR72.88 billion for the year will be reached thanks to an expected improved primary result for November and December and the drastic cut in interest rates in December. Brazil has committed itself to a fiscal goal of a public deficit of 4.7% of GDP for 1999 as part of the $41.5 billion IMF-led international preventive aid-package accord announced at the end of last year. Lopes said that following Wednesday's Central Bank decision to scrap the real-dollar crawling band and adjust upward the wide band - effectively devaluing the real - doesn't necessarily mean the fiscal goals have to be reviewed. But, he added, this could be possible. "Dollar-linked debt can possibly increase, but the expected lowering of interest rates over the next few months might partially offset the losses," Lopes said. Lopes, who was one of the chief negotiators leading up to the IMF deal, added that it is possible that the terms of the accord could be renegotiated. "I'm not saying that this will necessarily happen, and even if it does, it doesn't necessarily mean that the fiscal goals will definitely be reset," he commented. According to Lopes, the foreign exchange shift doesn't make it compulsory to review the accord.

To: David Petty who wrote (11666)	1/14/1999 12:44:00 PM
From: Steve Fancy	Respond to of 22640

Emerging Mkts ADRs Mixed In Cautious Trade; Investors At Bay Dow Jones Newswires NEW YORK -- Emerging market shares trading as American depositary receipts were mixed in thin volumes Thursday, the day after Brazil effectively devalued its currency by 8%, sending markets into a tailspin. Traders said investors were adopting a wait-and-see stance Thursday, remaining on the sidelines until the situation in Brazil becomes clearer. At around 1615 GMT, the Bank of New York index of emerging market ADRs was up 0.56% at 84.70. "There's definitely no buyers around," said one head trader. "There's a few sellers saying, 'We'll watch the market for a while'." Some Brazilian ADRs took heart from the local market's opening rally, triggered by a less-than-expected $1.1 billion capital outflow figure for Wednesday. But Brazilian stocks have returned to negative territory, after Standard & Poor's Thursday downgraded the country's long-term foreign currency rate and local currency rate to B+ and BB-, from BB- and BB+, respectively. At 1642 GMT, Brazil's benchmark Bovespa index was down almost 3.6% to 5413 points. Telecom Telebras HOLDRs were 3.2% lower at $55 at 1620 GMT, while the Telebras spinoffs were putting in a mixed performance. Telesp Celular rose 2.7% to 14 1/4, while Tele Centro Oeste Celular leapt 11.63% to $3. Mexican ADRs were mixed in similar cautious trading, with some of the larger issues bouncing back. Bellwether Telefonos de Mexico gained 1.2% at $42 3/4, and Coca-Cola Femsa rose 4.9% to $11 5/8. Retailers Comercial Mexicana and Elektra staged a mixed performance after Salomon Smith Barney Thursday downgraded its recommendation on the companies to Neutral from Buy citing potential spillover effects from the devaluation in Brazil. Elektra was up 1.7% at 3 1/13, and Comercial lost 1.7% to 11. Asian ADRs were mixed to higher, although volumes were again very thin. PT Telekomunikasi was unchanged at 7 11/16, while Taiwan Semiconductor rose 6.1% to $19 7/16. -By Thomas Catan; (201) 938-2225; thomas.catan@cor.dowjones.com