May 28, 2018 / 3:13 PM / a month ago

EMERGING MARKETS-Brazil's Bovespa hits 2018 low amid truckers protest

    SAO PAULO, May 28 (Reuters) - Brazilian equities plunged
over 3 percent on Monday, touching their lowest level this year,
as an ongoing truckers' strike hit all sectors of the economy
and state-run oil company Petroleo Brasileiro SA was
forced to adapt a number of policies that proved unpopular with
traders.
    Truckers have been blockading Brazil's highways for a full
week in protest of rising fuel prices. While some truckers
reached an agreement with the government late last week, that
accord lacked the agreement of the nation's largest trucking
group, Abcam, and the protest continued.
    That has wreaked havoc on sectors from aviation to
agribusiness to retail, as companies have been unable to obtain
supplies and deliver goods, including at major ports. 
    On Monday, Brazil's government proposed a variable tax
structure on oil, and said it would fix its prices for 60 days,
before adjusting them monthly.
    That helped send shares in Petrobras, as the state-run oil
company is known, plummeting, with common shares falling some
8.1 percent and preferred shares falling some 7.5 percent. The
company has lost some $44 billion in market value since May 21,
the day protests began.
    While the Abcam group had called on truckers to dissolve
highway blockades on Monday, protesters did not seem to be
heeding that call.
    Companies in other sectors, such as highway concessionaires,
bus operators, and retailers, also posted significant losses.
Brazil's benchmark Bovespa equities index had fallen
3.12 percent by late morning.
    "There's a general draining of supplies," said Marco Tulli
Siqueira, a trader on the Bovespa desk for Sao Paulo brokerage
Coinvalores, emphasizing that while Petrobras had taken a
significant hit, companies across the board were suffering.
    Shares in Brazilian highway operators CCR SA and
Ecorodovias Infraestrutura e Logistica SA fell 5.2
percent and 6.7 percent, respectively, after the governor of Sao
Paulo state said a presidential decree reducing the toll burdens
would reduce the state's monthly revenue by 50 million reais
($13.5 million).
    Shares in Brazil's two major food retailers, GPA,
owned by France's Casino Guicard Perrachon SA, and
Carrefour Brasil, fell 5.1 percent and 3.2 percent,
respectively.
    Brazil's real currency also slid, falling 1.1 percent
to 3.71 reais to the dollar, as traders fretted over the
position of Brazil's government, which has attempted to
introduce relative austerity to Latin America's largest economy,
but has continued to see its political capital evaporate.
    
Key Latin American stock indexes and currencies at 1432 GMT:
    
 Stock indexes                           daily %     YTD %
                             Latest       change    change
 MSCI Emerging Markets         1137.65      0.09     -1.88
                                                  
 MSCI LatAm                    2591.83     -2.42     -6.08
                                                  
 Brazil Bovespa               76439.35     -3.12      0.05
                                                  
 Mexico IPC                   45199.24      0.24     -8.42
                                                  
 Chile IPSA                    5589.93      0.24      0.46
                                                  
 Chile IGPA                   28271.00      0.23      1.04
                                                  
 Argentina MerVal             29431.27     -0.79     -2.11
                                                  
 Colombia IGBC                11996.16     -0.54      5.50
                                                  
 Venezuela IBC                30282.23      3.17   2297.38
                                                  
                                                          
 Currencies                              daily %     YTD %
                                          change    change
                                Latest            
 Brazil real                    3.7110     -1.17    -10.72
                                                  
 Mexico peso                   19.5950     -0.30      0.53
                                                  
 Chile peso                        625     -0.11     -1.66
                                                  
 Colombia peso                    2876     -0.03      3.69
 Peru sol                        3.271     -0.09     -1.04
                                                  
 Argentina peso                24.6000      0.00    -24.39
 (interbank)                                      
                                                  
 Argentina peso                   25.5     -0.39    -24.59
 (parallel)                                       
                                                  
 
 (Reporting by Gram Slattery and Paula Arend Laier
Editing by Nick Zieminski)
  
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