Brazil’s Bovespa Index dropped 227.79 points, or 0.54%. Mexico’s benchmark Bolsa Index fell 41.86 points, or 0.19%, while Argentina’s Merval Index added 4.01 points, or 0.21%.
Brazilian stocks dropped on profit taking and disappointment among some investors that the U.S. Federal Reserve’s monetary policy statement did not signal a likely pause in the current tightening cycle at future meetings.
The Fed raised this Wednesday, May 10, its key short-term interest rate by 25 basis points to 5% as expected, marking its 16th straight rate hike.
In its accompanying statement, the Fed said further hikes may be needed to address inflation risks but that the timing of such tightening would be data dependant. Some investors had hoped the Fed would indicate a near-term pause in its tightening campaign.
On an up note, local economic data showed a drop in Brazilian inflation, fueling expectations for a continued decline in domestic interest rates.
The IBGE reported that inflation as measured by the official IPCA consumer price index tumbled to 0.21% in April from 0.43% in March.
The IPCA rate for the 12 months ended in April dropped to 4.63% from 5.32% for the 12 months ended in March, marking the lowest 12-month rate since July of 1999.
In corporate news, steelmaker Companhia Siderúrgica Nacional (CSN) reported a first-quarter net profit of 340 million reais, down 53% from a year ago, as net revenue dropped 32% to 1.95 billion reais.
Also reporting, electric power utility Companhia Energética de São Paulo (CESP) posted a first-quarter net profit of 78.2 million reais, up sharply from a year-earlier net loss 162.1 million reais.
Meanwhile, a major investment bank started coverage of supermarket chain Companhia Brasileira de Distribuição (CBD) with an "overweight" rating, citing improving same-store sales and strengthened management.
In other analyst actions, another major investment bank downgraded steel producer Gerdau to "neutral" from "buy," citing a weak outlook for domestic demand.
Elsewhere, Mexican shares were also dragged under by profit taking and continued uncertainty about the U.S. interest-rate outlook.
Bucking the downtrend, however, shares of Wal-Mart de Mexico climbed after the retail giant reported a 9.9% jump in April same-store sales from a year earlier, helped by a late Easter holiday. Total sales rose 20.7% from April 2005 to 14.97 billion pesos.
Argentine issues edged up, as investors digested some fresh earnings news. Textile manufacturer Alpargatas reported a first-quarter net profit of 7.04 million pesos, while power generator Centro Puerto posted a first-quarter net loss of 107.2 million pesos. Neither company provided comparison figures for the year-earlier quarter.
Thomson Financial – www.thomsonfinancial.com
]]>Brazil’s Bovespa Index dipped 87.35 points, or 0.23%. Mexico’s benchmark Bolsa Index jumped 166.79 points, or 0.88%, while Argentina’s Merval Index surged 17.96 points, or 1.00%.
Brazilian shares moved lower ahead of an options expiry this coming Monday. Political turmoil resurfaced in Brazil today. A witness testified before a Senate committee that Finance Minister Antonio Palocci visited a Brasília house that has been linked to a kickback scheme.
On the economic front, the National Confederation of Industries, or CNI, said that industrial capacity fell to 80.4% in January, compared with 82.7% in the corresponding period a year ago.
December’s reading was 80.7%. Separately, minutes from the Brazilian Central Bank’s March meeting indicated a continued gradual decline in the country’s Selic base rate.
Supermarket chain CBD said that its nominal same-store sales dipped 1.6% in February from a year ago, while same-store sales, when adjusted for inflation, dipped 0.4% in February from a year ago. Gross sales jumped 2.9% on the year last month to 1.259 billion reais. Net sales rose 3.8% to 1.057 billion reais.
Meanwhile, the Brazilian Steel Institute said that domestic crude steel production slumped 17.7% in February from a year ago due to stoppages for maintenance and accidents.
In Mexico, economic news on both sides of the border garnered attention. U.S. consumer prices were benign in February, reducing inflationary concerns. Also, the Philly Fed business activity index continued to expand last month.
Domestic industrial production was bolstered by continued strength in the automotive and construction sectors. Industrial output rose 6% in January from a year ago, easily beating analyst expectations.
Turning to corporate news stories, homebuilder Consorcio Ara increased its growth estimates for 2006. The firm sees home sales rising 20% this year, up from its prior estimate of 12%. That firm’s shares rose on the session.
Elsewhere, state-oil firm Pemex said that its proven hydrocarbon reserves stood at 16.5 billion barrels of crude-oil-equivalent as of January 1, down from 17.6 billion barrels a year ago.
Argentine issues continued to rally today, as most shares within the benchmark Merval Index saw gains. Economic reports were also in focus today.
In economic news, the national statistics agency, or Indec, said that gross domestic product rose 2.1% in the fourth quarter of last year from the third quarter, while advancing 9.1% year-over-year. Separately, February manufacturing activity surged 8.6% on the year and 3.1% on the month.
Banks were positive on the session. Banco Marcro Bansud advanced ahead of its listing in U.S. markets. The firm announced last night that the preferential subscription for its 75 million new Class B shares will begin March 22.
Thomson Financial – www.thomsonfinancial.com
]]>Brazil’s Bovespa Index jumped 1,033.31 points, or 3.08%. Mexico’s benchmark Bolsa Index gained 574.99 points, or 3.21%, while Argentina’s Merval Index added 46.33 points, 2.98%.
The main stock driver in the region hailed from the Northern hemisphere, when minutes of the U.S. Federal Open Market Committee’s December meeting on interest rates showed a majority of its members believe the central bank will only need to implement a few more rate hikes to contain inflation.
Most members believe that "the number of additional firming steps required probably would not be large," according to the minutes. Rising U.S. interest rates often redirect fund flows away from emerging markets such as Latin America.
The Brazilian market advanced, with blue chip stocks reportedly drawing a majority of foreign funds, according to news reports. Investors are optimistic about growth for the local economy in 2006, amid lower interest rates. Brazil’s central bank is meeting on January 18 and is expected to cut rates anew by at least 50 basis points.
In company news, mining firm Vale do Rio Doce, CVRD, saw some interest on news it is planning to buy back debt worth US$ 300 million, in a bid to reduce its debt exposure.
Also, grocer CBD climbed, with some analysts anticipating strong sales of durable consumer goods in 2006, due to consumer’s increased access to credit thanks to the company’s venture with bank Itaú.
On the downside, a major investment bank cut airline Gol to "neutral" from "buy," citing valuation, while upgrading Chile’s LAN Airlines to "buy" from "neutral," due to an improved earnings outlook.
Elsewhere, Mexican shares posted robust gains, in tandem with U.S. counterparts, following the release of the Fed’s encouraging minutes. Bullish sentiment about the local economy also helped.
Of note, a local brokerage expects many of the factors that supported the market in 2005, such as lower interest rates and stable economic conditions, to continue this year.
In research, an influential investment bank expects America Movil to outrun fixed line Telmex, but added that Mexican telecoms look relatively less attractive than Brazilian telecoms.
Separately, news services reported that the newly listed shares of the infrastructure and construction companies controlled by billionaire Carlos Slim found support on expectations that they will be added in February to the IPC stock index.
Meanwhile, in Argentina, stocks advanced, in line with regional counterparts, and as investors readjusted their holdings to match changes in weightings for some of the companies listed in the Merval.
Steel tube manufacturer Tenaris and power transporter Transener saw their weight increase, while banks’ prominence was revised lower. However, Banco Macro Bansur bounded, amid talk that it is better positioned than its peers, as it is preparing to list ADRs in New York.
Thomson Financial – www.thomsonfinancial.com
]]>Brazil’s benchmark Bovespa Index leapt 209.82 points, or 0.63%, while Mexico’s benchmark Bolsa Index rallied 234.35 points, or 1.32%. Argentina’s Merval Index rebounded 10.15 points, or 0.67%.
Brazilian shares posted solid gains on the day with stocks closing at a record high ahead of an expected interest-rate cut by the Central Bank, with some analysts anticipating a cut by up to a full percentage point.
At the end the Central Bank lowered the overnight interbank rate by half percent bringing it to 18%. With this cut, the Selic base rate has come down 1.75 percentage points from a two-year high of 19.75 percent in September.
In other economic data, the Brazilian Census Bureau, or IBGE, said that October retail sales edged up 0.06% on a seasonally adjusted basis, compared to September. The result was below analyst expectations. Retail sales jumped 3.74% in October, compared with the year-ago result.
Meanwhile, the Ibope, the Public Opinion Research Institute said that approval for the Workers’ Party government fell to 42% in December from 45% in September, according to a poll. Personal approval for President Luiz Inácio Lula da Silva declined to 43% in December from 44% in September, when the poll was last taken.
Turning to corporate reports, low-cost airline Gol officially signed a deal to create a joint venture with Mexican business executive Fernando Chico Pardo and a group of partners to launch a low-cost airline in Mexico next year.
Retailer CBD moved lower, after U.S.-based Wal-Mart Stores bought Portuguese retailer Sonae’s Brazilian unit for 635 million euros.
Elsewhere, fixed line operator Telesp announced its intentions to increase investment to 1.7 billion reais in 2006 from this year’s 1.3 billion investment, as the firm expands its broadband and video services.
Mexican stocks broke through the 18,000 point level for the first time, amid upbeat sentiment on falling interest rates. Similarly, U.S. markets continued to benefit from buzz that the Federal Reserve may stop raising interest rates sooner than expected.
In corporate news, government-owned airline holding firm Cintra reaffirmed its plans to sell remaining airline AeroMexico in the short term.
Meanwhile, the Mexican Senate approved changes in the country’s energy laws, which will now allow Pemex to produce and sell electricity. The firm will be able to produce electricity through a process known as cogeneration and then sell it to CFE and LFC, two other state-run power utilities.
Argentina finally managed a rebound following a string of declines. Investors indulged in some bargain hunting and were enthused by broader regional gains.
Finally, Spanish-Argentine energy firm Repsol YPF announced its intention to increase the amount it invests in Argentina between 2005 and 2009 by US $700 million to US $6.7 billion. The money will partly be used to expand installed capacity at its refineries in La Plata, Lujan de Cuyo and Plaza Huincul.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>Meanwhile, Argentine issues were dragged under by a local oil giant’s disappointing quarterly results.
Brazil’s Bovespa Index added 64.74 points, or 0.21%. Mexico’s benchmark Bolsa Index rose 43.62 points, or 0.27%, while Argentina’s Merval Index fell 25.09 points, or 1.50%.
Brazilian shares edged higher, supported by a drop in oil prices overseas and optimism about local third-quarter earnings reports.
Banco Bradesco kicked off a busy earnings week, saying its third-quarter net profit soared 90.1% from a year earlier, helped by expansion of its credit portfolios and cost- cutting efforts.
A flood of other key earnings reports are due out this week from the likes of grocer Companhia Brasileira de Distribuicao, steel companies Gerdau and Usiminas, miner Vale do Rio Doce, and oil giant Petrobras.
In other corporate news, budget airline Gol announced flights to Bolivia’s Santa Cruz de la Sierra, the company’s second international destination. Gol began flying to Buenos Aires in December 2004.
Meanwhile, Brazil’s Civil Aviation Department reported that paying passengers on Brazil’s domestic airlines flew a total of 3.15 billion kilometers in October, up 27.1% from a year earlier. Results were helped in part by a rise in the number of flights run by Brazil’s largest local carrier TAM SA and budget operator Gol.
Elsewhere, Mexican shares posted modest gains, in line with the U.S. market. Mexican shares were supported by positive sentiment generated by recent strong earnings from local companies.
Among the movers, Wal-Mart de Mexico climbed ahead of its October same- store sales report on Wednesday. An influential investment bank said in a report that it expects Walmex’s sales to have grown at least 5% from a year ago. "The calendar is slightly negative, but the recent trend of exceptional sales should continue regardless," the bank said.
Meanwhile, shares of wireless operator America Movil were active after a brokerage said in a report today that Spanish telecom giant Telefonica’s planned acquisition of O2 Plc of the U.K. is positive for America Movil, since it suggests that the Mexican carrier’s key competitor is aiming its expansion efforts more at Europe than Latin America.
In other news, Mexico’s insurance industry association said that preliminary estimates point to US$1.7 billion in claims from the three hurricanes that hit the country this year.
Argentine stocks dropped, undermined by weakness in shares of Petrobrás Energia Participaciones, after the company reported lackluster earnings. Results were hurt in part by higher sales and administrative costs, and taxes on earnings.
The oil giant posted a net profit of 118 million pesos for the third quarter of 2005, down from 151 million pesos a year earlier. Net sales for the period rose to 2.73 billion pesos from 2.36 billion pesos a year ago, while gross profit increased to 869 million pesos from 819 million pesos.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>Latin American markets had a robust session, with international investors continuing to boost the region, amid weakness in the U.S. High oil prices and jitters ahead of tomorrow’s Fed meeting plagued that market.
Brazil’s benchmark Bovespa Index jumped 260.19 points, or 0.87%, while Mexico’s benchmark Bolsa Index climbed 228.06 points, or 1.48%. Argentina’s Merval Index added 21.82 points, or 1.34%.
Brazilian shares powered ahead, building on recent gains. On the economic front, the trade surplus reached US$ 1.30 billion in the September 12-18 period, swelling the year-to-date surplus to US$ 31.03 billion. Exports totaled US$ 2.84 billion, while imports totaled US$ 1.54 billion.
Also, the central bank’s weekly survey of analysts found that expectations for 2005 inflation rose to 5.21% from the 5.20% seen last week, due to Petrobras’ recent decision to raise wholesale fuel prices. Investors also awaited minutes from the central bank’s last meeting, due out later this week.
In corporate news, Banco Itaú was in focus after announcing a nine-to-one stock split in order to boost liquidity in its shares.
In deals, steelmaker Gerdau agreed to pay US$ 40.5 million over three years to increase its stake in an Argentine rolling mill, Sipar, to 83.77%.
In research, an investment bank maintained its “buy” rating on supermarket chain CBD, citing the firm’s ability to benefit from falling interest rates.
Mexican issues, meanwhile, jumped, continuing a rally that started before the long weekend. Infrastructure company Ideal continued to lure buyers after its successful IPO last week.
In economic news released after the close, sales at supermarkets and department stores rose 7.9% in August from a year ago, although same-store sales eased 0.2%.
Also of note, homebuilder Sare Holding SA and Anida, the real estate unit of Spain’s Banco Bilbao Vizcaya Argentaria agreed to cooperate on the building of apartment complexes in an investment worth about 600 million pesos.
In addition, financial group Banorte drew attention on news its shareholders would vote Oct. 6 on a possible dividend payment and capital increase.
Argentine stocks joined the rally party, following some profit-taking late last week after hitting record highs.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>Brazil’s benchmark Bovespa Index fell 26.86 points, or 0.09%, while Mexico’s benchmark Bolsa Index dropped 190.31 points, or 1.25%. Argentina’s Merval Index rose 7.55 points, or 0.47%.
Brazilian stocks dipped, as investors weighed continued high oil prices against hopes the central bank will cut interest rates. Oil prices climbed for the first time in four sessions amid weekly data showing a drop in U.S. crude supplies. High oil prices are seen as one of the biggest threats to inflation in Brazil, which is a net oil importer.
In economic data, the Brazilian Census Bureau said industrial output fell a bigger-than-expected 2.5% in July from June. Analysts had expected a drop of just 0.7%.
On an up note, the data fueled expectations the Brazilian central bank will aggressively cut interest rates at its meeting next Wednesday. Talk of a rate cut was initially prompted by recent data showing inflation fell in August from the previous month.
In corporate news, Brazilian airline Viação Aérea Riograndense SA, or Varig, reported a net loss of 508.7 million reais for the first seven months of 2005, compared to a loss of 542.1 million reais a year ago. Net revenue was 4.1 billion reais, up from 3.9 billion reais.
In research, an investment bank downgraded grocer CBD to "neutral" from "buy," citing its price performance. Meanwhile, another bank raised its 12-month price target on bottler AmBev to US$ 45 from US$ 36, saying the company is likely to meet or exceed profitability targets and improve its dividend outlook.
Also, an investment house upgraded Brazilian utility companies AES-Tietê SA and Tractebel Energia SA to "outperform" from "peer perform."
Elsewhere, Mexican stocks sank, as investors took some profits following three straight sessions of record closing highs. In economic news, a Bank of Mexico official commented that the central bank expects Mexico’s economic growth to slow to 3%, down from prior forecasts looking for growth between 3.25% and 3.75%. The latest move reflects a weaker-than-expected gross domestic product figure in the second quarter.
Meanwhile, the Bank of Mexico said the Consumer Price Index rose 0.12% in August, below expectations for an increase of 0.19%. The result brought annual inflation down sharply to 3.95% from 4.47% at the end of July, and closer to the central bank’s 3% target. The core index rose 0.07%.
Argentine issues gained ground, hitting a fresh record high. Analysts attributed the gains to an absence of negative economic news, according to news services.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>Latin American markets reversed course and turned broadly positive today, following steep declines yesterday. Investors also cheered strength in U.S. markets, which benefited from a steep decline in oil prices and stronger-than-expected earnings from tech giants Hewlett-Packard and Applied Materials.
Still, U.S. data showed a surprising surge in producer prices last month. Brazilian issues leapt ahead of the country’s highly anticipated rate decision, which ended up staying at 19.75%.
Mexican stocks managed to squeak higher, after trading in the red for most of the session. Investors are still digesting the country’s weaker-than-expected GDP report released yesterday. Meanwhile, Argentina turned around, following three-consecutive down sessions.
Brazil’s benchmark Bovespa Index surged 336.02 points, or 1.24%, while Mexico’s benchmark Bolsa Index edged up 1.14 points, or 0.01%. Argentina’s Merval Index jumped 19.86 points, or 1.35%.
Brazilian issues strongly rebounded from yesterday’s declines. Investors during the session were expecting the central bank to keep the reference Selic rate unchanged.
Brazil also benefited from a plunge in oil prices, which finished below US$ 64 a barrel. Brazil is a net importer of crude oil.
Within the telecom group, the Brazilian Court of Audit issued an injunction that prevents U.S.-based Citibank from selling its participation in Brasil Telecom to the pension funds of Petrobras, Banco do Brasil and Caixa Econômica Federal. A final ruling will still need to be issued, however.
Brazil’s biggest grocer CBD announced that its chief executive, Augusto Marques da Cruz Filho, will resign from the post within the next few months to pursue personal interests.
In deal reports, steel manufacturer Group Gerdau bought a 1.5% stake in Columbia’s Diaco for US$ 1.98 million in a public tender offer.
Mexican shares made a late-day comeback, ending nearly flat, following a mostly negative session. Yesterday, Mexico’s Finance Ministry issued a disappointing second-quarter gross domestic product report.
Following the lackluster figure, several investment banks reduced their 2005 forecasts for Mexican growth.
Talks with striking steel workers at Mexico’s Sicartsa plant continued, and a union official said that mining operations should remain normal today.
Grupo Mexico shares continued to weaken, however, as some of the firm’s mining operations have recently been impacted by the work stoppages.
Argentina’s stocks witnessed a recovery today from a recent bout of weakness. On the corporate front, conglomerate Techint completed its public tender offer for shares of Mexico’s Hylsamex. The deal is expected to close next week.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>The American economy suffered from stronger-than-expected CPI data, disappointing industrial production and capacity utilization figures and a warning from Wal-Mart Stores that surging oil prices are pressuring its current-quarter results.
Brazil’s benchmark Bovespa Index plunged 294.92 points, or 1.08%, while Mexico’s benchmark Bolsa Index tumbled 283.51 points, or 1.91%. Argentina’s Merval Index declined 8.35 points, or 0.56%.
Brazilian issues returned some of the impressive gains tallied recently. Investors also focused on a fresh batch of earnings reports and continued awaiting tomorrow’s central bank meeting on interest rates.
On the economic front, the Brazilian Census Bureau, or IBGE, said that retail sales jumped a seasonally adjusted 1.8% in June from the prior month. June’s result leapt 5.31% when compared to the year-earlier figure; although, that result was not seasonally adjusted.
In earnings headlines, state-run oil firm Petrobras said that its second-quarter net profit leapt to 4.93 billion reais from 3.30 billion reais a year earlier, aided by a jump in oil exports amid a hefty rise in crude oil prices. Net operating revenue jumped to 32.36 billion reais from 28 billion reais last year, while EBITDA surged to 11.809 billion reais from 8.652 billion reais.
Within the electric power utility group, Copel said that its net profit advanced to 196.7 million reais in the first half from 172.8 million reais last year. The firm cited an increase in its customer base and rising public utility rates for the improved result.
Gross revenue climbed to 3.271 billion reais from 2.613 billion reais last year, while EBITDA slipped to 488.1 million reais from 491.6 million reais a year ago.
Separately, Light Serviços de Eletricidade said that it swung to a second-quarter net profit of 10.1 million reais, reversing a year-earlier loss of 16.9 million reais, as a rise in sales volumes of energy benefited the most recent result.
Net revenue climbed to 1.17 billion reais from 1.04 billion reais, while EBITDA dipped to 64.2 million reais from 266.1 million reais.
Last night, Sabesp said that it swung to a second-quarter profit of 335.7 million reais from a year-earlier loss of 73.3 million reais, while operating profit was 494.9 million reais, compared to last-year’s loss of 74.3 million reais. Net revenue climbed to 1.23 billion reais from 1.038 billion reais.
Meanwhile, the country’s biggest grocer, CBD, said that its same-store nominal sales increased 3% in July, compared to the year-ago figure. After an inflation adjustment, same-store sales declined 3.4%. Gross sales advanced 4.8% in July, reaching 1.32 billion reais, while net sales rose 6.2%.
Mexican shares turned lower, after the market reached another record high yesterday. U.S. market weakness also dampened local market sentiment. On the economic front, the Finance Ministry reported that Gross Domestic Product grew a disappointing 3.1% during the second quarter, compared to 2.4% growth in the first quarter.
Brokerage notes were in focus today. A major investment bank upgraded airport operator Asur to "outperform" from "peer perform" due to the company’s future growth prospects. The bank also initiated a year-end fair value of $47 per American Depositary Receipt and $52 for 2006. Asur shares climbed in response.
Separately, another large investment house downgraded brewing and bottling firm Femsa to "hold" from "buy," as its shares approach fair value. The bank raised its 12-month price target on the firm’s ADRs to $76 from $70. Femsa shares slumped on the day.
Meanwhile, Argentinean stocks were broadly lower amid a lackluster gross domestic product report. For the June period, the national statistics agency, or INDEC, said the preliminary reading of the GDP showed growth of 0.1% month-on-month, but surged 8.6% when compared to the year-earlier period.
Thomson Financial Corporate Group – www.thomsonfinancial.com
]]>Latin American shares moved in different directions today, with Brazil trending lower and Mexico posting gains. Meanwhile, Argentine markets were closed in recognition of Flag Day.
U.S. markets weaved in and out of positive territory, but ultimately finished lower amid another advance in oil prices to a level beyond US$ 59 a barrel. Also pressuring U.S. shares was a larger-than-expected decline in May’s leading indicators.
Brazil’s benchmark Bovespa Index erased 47.38 points, or 0.18%, while Mexico’s benchmark Bolsa Index advanced 63.40 points, or 0.46%.
Brazilian issues eased on the day, following recent strength on dissipating political concerns. Still, investors are somewhat wary of further bribery allegations implicating state-run firms and the ruling Workers Party. Last week, the former presidential chief of staff, José Dirceu, resigned amid corruption claims.
Also pressuring Brazil, which imports oil, were security concerns in Nigeria and possible strikes amongst Norwegian oil workers, which helped push crude oil prices past US$ 59 a barrel.
In economic news, the University of São Paulo’s IPCA-Fipe inflation figure arrived at 0.07% for the four weeks ending June 15, below analyst expectations.
Separately, the central bank’s weekly survey of economists showed that 2005 inflation expectations continued to decline.
Participants in the survey expect the main IPCA consumer price index to advance 0.30% in June, 0.55% in July and 6.16% in 2005.
All three forecasts declined from the prior week’s expectations. The report follows the central bank’s end to its monetary tightening cycle last week.
Turning to corporate reports, state-run oil firm Petrobras announced its intentions for a 4-1 share split, a dividend payment and the formation of an external auditing committee that will focus on complying with U.S. rules associated with the Sarbanes-Oxley law.
Meanwhile, a major brokerage firm downgraded grocer CBD to “peer perform” from “outperform” and slashed its year-end price target to US$ 23.50 from US$ 25. The broker cited “deteriorating food-sector retail trends” as part of the reasoning behind the move.
Airline Varig won a temporary injunction from the U.S. Bankruptcy Court in Manhattan, which bars creditors from obtaining its planes.
Under a new Brazilian bankruptcy law, Varig has 60 days from the date of its bankruptcy filing to provide a recovery plan to creditors.
Separately, Varig confirmed that discussions have ceased with TAP Air Portugal, in which TAP would purchase a 20% stake in the Brazilian carrier.
Mexican shares bucked the broadly lower trend in Latin America and the U.S. by posting gains. Investors focused on financial guidance from the world’s third-largest cement maker.
Cemex announced that it expects 2005 EBITDA to exceed its current estimate for US$ 3.5 billion. The firm expects second-quarter EBITDA of US$ 970 million, up from US$ 635 million in the corresponding period a year ago.
Revenue for the quarter is expected to reach US$ 4.4 billion, up from US$ 1.9 billion last year. Cemex credits higher demand and the purchase of RMC Group for the rosier outlooks.
Thomson Financial Corporate Group – www.thomsonfinancial.com
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