Brazil Stocks Accelerate Decline On Dubai News
SAO PAULO -(Dow Jones)- Brazil stocks accelerated their decline in the early
afternoon hours as investors ponder the possibilities of a multi-billion dollar
default by the Dubai government investment fund, Dubai World.
Wednesday's news that Dubai World would defer a short term loan facility for
six months sent emerging markets in a free fall Thursday, and Brazil was no
exception.
The Ibovespa stock index opened 1% lower, but only recently began to sink
further. The Ibovespa was down 2.01% to 66,554 points in early afternoon trade.
Brokerage Hencorp Commcor in Sao Paulo has short-term support at 66,000.
"The Dubai news just reminded investors that banks still have a lot of dirt
swept under their rugs," said Mauro Cunha, portfolio manager for Maua investment
funds in Sao Paulo.
"All of this recent liquidity had investors forgetting about bad loans and
over-leveraged companies and the risk that poses to banks, but today they were
reminded of that," Cunha said.
Nearly all of Brazil's stocks were selling off Thursday.
Petrobras (PBR) was down 2% to 38.66 Brazilian reals ($22.34) per share and
mining company Vale SA (VALE) was down 2.10% to BRL42.46 in active trade.
Other most active stocks were also down. Energy company Cemig (CIG) was down
1.5% to BRL29.56 and retailers Lojas Renner (LREN3.BR) and Lojas Americanas (
LAME4.BR) were also lower. Both were underperforming the market. Renner was off
4.48% to BRL37.11 and Lojas Americanas was off 3.8% to BRL13.86.
-By Kenneth Rapoza, Dow Jones Newswires, 5511-2847-4541, kenneth.rapoza@
dowjones.com
(END) Dow Jones Newswires
11-26-091111ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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