EMERGING MARKETS-Brazil stocks plunge in broad sell-off

Tue Jul 2, 2013 6:03pm EDT

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* Weak Brazil industrial output data prompts early losses
    * Brazil's Bovespa down 4.2 pct, Mexico's IPC down 0.8 pct


    By Lucas Iberico-Lozada and Noe Torres
    SAO PAULO / MEXICO CITY July 2 (Reuters) - Brazilian stocks
fell on Tuesday to close at their lowest level in more than four
years after weak industrial output data darkened the outlook for
Latin America's largest economy.
    Mexico's IPC index ended a five-day rally with a 0.84
percent fall as investors sold emerging market assets amid
renewed concerns the U.S. Federal Reserve could soon withdraw
its monetary stimulus.
    The Fed's stimulus had lowered interest rates in the U.S.,
driving investors towards riskier assets in emerging markets.  
    Chile's bourse fell for the second day in a row
after four straight days of gains last week. 
    * Brazil's benchmark Bovespa stock index dropped to
its lowest level since April 2009, losing 4.24 percent for its
largest one-day drop since September 2011, to close at
45,228.95.
    * Stocks fell early in the session after data showed
Brazil's industrial output fell twice the amount analysts had
expected in May and raised doubts over a recovery in Latin
America's largest economy.
    * "We are in a period of huge volatility, the market is
trending downward, and we have no buying support as people are
still expecting the market to go lower as we break through
supports," said Alexandre Ghirghi, a strategist with Metodo
Investimentos in Sao Paulo.
    * Shares of mining firm Vale SA led losses,
sinking 4.3 percent.
    * Shares of OGX Petroleo e Gas Participacoes SA,
the troubled oil company controlled by Brazilian billionaire
Eike Batista, tumbled 19.64 percent Tuesday following an
announcement Monday that the firm would shelve three offshore
oil projects. 
    * Mexico's IPC index fell 0.84 percent to close at
40,832, pulling back after an about 10 percent gain in the
previous five sessions. 
    * Speculation mounted that data to be released Friday on
U.S. nonfarm hiring would be positive, which could lead the Fed
to begin tapering its $85 billion asset-purchasing program
.
    * "The rebound was so strong that now the market is taking a
breath," said Luis de Urquijo, strategist at portfolio manager
Compass group. "With Friday's data the pressure on interest
rates will either relax or react to uncertainty." 
    * Shares of telecommunications firm America Movil,
controlled by billionaire Carlos Slim, fell 0.98 percent to lead
losses, while lender Grupo Financiero Banorte SA 
fell 2.57 percent.
    * Chile's IPSA index fell 1.95 percent to 3,876.62
as shares of the Chilean branch of Santander bank fell
2.89 percent. 
    
    Latin America's key stock indexes at 2100 GMT:
 Stock indexes                          daily %     YTD %
                              Latest     change    change
 MSCI LatAm                  3,101.16     -2.87    -18.34
                                                 
 Brazil Bovespa             45,228.95     -4.24    -25.80
                                                 
 Mexico IPC                 40,832.48     -0.84     -6.57
                                                 
 Chile IPSA                  3,876.62     -1.95     -9.87
                                                 
 Chile IGPA                 19,234.91      -1.6     -8.71
                                                 
 Argentina MerVal            2,994.08     -0.85      4.90
                                                 
 Colombia IGBC              12,742.77     -0.67    -13.41
                                                 
 Peru IGRA                  15,492.35     -0.83    -24.90
                                                 
 Venezuela IBC                   0.00         0   -100.00
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