EMERGING MARKETS-Brazil stocks extend sell-off on election outlook

martes 30 de septiembre de 2014 12:40 GYT

SAO PAULO, Sept 30 (Reuters) - Brazilian stocks extended
their slide on Tuesday, a day after posting their biggest
one-day loss in over three years, as investors priced in a
higher likelihood of President Dilma Rousseff winning a second
    A poll released late on Friday by research firm Datafolha
showed Rousseff with 47 percent of voter support against Silva's
43 percent in a potential second-round runoff. Another poll
released just before the market close on Monday showed Rousseff
with 47.7 percent in the second round, against Silva's 38.7
    The first round of Brazil's presidential election is on
Sunday. If a second round is necessary, it will be held three
weeks later.
    Brazilian investors have been heavily critical of Rousseff's
government for implementing policies that have gone against
minority shareholder interests in state-run companies and a
tendency to enact one-off stimulus measures rather than
structural reforms.
    Brazil's Bovespa stock index dropped about 1 percent
on Tuesday and was on track to close the session with an 11.7
percent monthly loss - the biggest monthly drop since October
2008, at the height of the global financial crisis.
    "Volatility should continue high until we have a clear
definition of the potential winner," Bank of America analyst
Felipe Hirai wrote in a client note on Tuesday.
    State-run companies fell further after taking a beating on
Monday, with common shares of Banco do Brasil SA and
electric utility Eletrobras down 6 percent and 4.2
percent, respectively. Banco do Brasil is down about 26 percent
for September, and Eletrobras is down about 19 percent for the
    The broader MSCI Latin American stock index 
was down about 0.5 percent, with Mexican stocks little
changed and Chilean shares slightly lower.
    The Brazilian real rebounded slightly as bargain
hunters stepped in after the currency closed at its weakest
level since December 2008 on Monday.
    "The market is taking a breather, but if the election
outlook doesn't change, the dollar won't weaken (against the
real) much more than this," said Reginaldo Siaca, head of
currency trading at brokerage Advanced in Sao Paulo.
    Yields on Brazilian interest rate futures <0#DIJ:> also
retreated slightly after shooting higher on Monday.
    Key Latin American stock indexes and currencies at 1627 GMT:
 Stock indexes                        daily %    YTD %
                             Latest    change   change
 MSCI Emerging Markets       1004.68    -0.47     0.67
 MSCI LatAm                  3163.06    -0.54    -0.65
 Brazil Bovespa             54040.47    -1.07     4.92
 Mexico IPC                 44889.55    -0.02     5.06
 Chile IPSA                  3937.31    -0.17     6.44
 Chile IGPA                 19222.02    -0.09     5.46
 Argentina MerVal          12557.119    -0.28   132.93
 Colombia IGBC              13658.33    -0.43     4.49
 Peru IGRA                  16272.16    -1.79     3.29
 Venezuela IBC               2914.92     0.31     6.52
 Currencies                           daily %    YTD %
                                       change   change
 Brazil real                  2.4541     0.04    -3.96
 Mexico peso                  13.429     0.54    -2.97
 Chile peso                    597.9     0.72   -12.01
 Colombia peso               2022.54     0.12    -4.48
 Peru sol                      2.889     0.24    -3.32
 Argentina peso               8.4725     0.09   -23.37
 Argentina peso                 15.7    -0.64   -36.31
 (Reporting by Bruno Federowski and Paula Laier; Writing by
Asher Levine; Editing by Leslie Adler)