Latin American markets are broadly lower amid growing fears of a
potential rout of emerging markets that are heavily weighted to
resources stocks, with commodity prices weak and no signs of a pick
up in demand any time soon. But while Mexico's IPC index is down
more than 400 points, it has recovered 100 points in the last short
while and was down around 2% earlier amid growing expressions of a
potential rout for emerging-market stocks.
Brazil's Ibovespa index yesterday became the first emerging
market index to stumble into bear-market territory, falling 21%
below its early January highs as the country's once surging economy
continues to slow and the Brazilian real depreciates to a four-year
low against other global currencies.
Various analysts have attributed the slide for Brazilian and
other Latin American stocks to the slowdown in the Chinese economy,
the largest single buyer of raw goods from the region, and the
resulting price drop for commodities like copper and iron ore.
Brazilian miner Vale SA (
) is down another 1.8% today, adding to a 36% skid for the stock
since its Jan. 3 peak. Southern Copper Corp. (
) is down 0.4% in Wednesday trading and extending its 29% decline
since late January.
Energy stocks also have been hard hit. ADRs of Brazil's
state-owned oil and gas major Petrobras (
) are down 35% from their September highs while rival OGX Petroleo
(OGXP3.SA) was down a whopping 85% from high-water mark prior to
falling another 7.7% today.
Here's where the regional markets stand today:
- Ibovespa steady in recent minutes. Down 353.78 (-0.7%) to
- IPC (Mexico City) was down 513.30. Now down 418.9(-1.05%) to
- Santiago Index IPSA down 17.72 (-0.45%) to 3,945.2.
- Merval Buenos Aires -30.75 -0.9% 3,311.88.
IN ADR news, grain processor Bunge Inc (
) is up 1.2% today after reportedly receiving an upgrade to
Overweight from Neutral by analysts at Piper Jaffrey.