STXNEWS LATAM-Solid outlook for Brazil companies-Morgan Stanley survey

Wed Feb 27, 2013 9:03am EST

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According to Morgan Stanley & Co strategists led by Guilherme Paiva, the outlook for Brazilian companies appears to be solid. The firm launched the Brazil Corporate Outlook Index on Wednesday, a barometer based on a quarterly poll of publicly traded companies and the bank's equity research analysts.

The positive view in the MSBCOI, as the index is known, is backed by positive sentiment towards business expectations, advanced bookings and investment plans, all above the index's neutral 50 percent threshold. Meanwhile, current hiring conditions seem to be cooling down. The index had a reading of 55 percent in the first quarter. Roughly one-third of respondents said business conditions improved during the quarter, close to 25 percent of them said conditions worsened and about 44 percent did not see material changes.

The vast majority of companies expect margins to either improve or remain stable, despite inflationary pressures that have appeared year-to-date, the bank said in a report.

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