Latin America

  • 2015-09-03 11:27


    --Political Weakness Leading to Abandonment of Reformist Policies
    --Finance Minister's Days May be Numbered

    SAO PAULO (MNI) - Brazil's economic and political crisis has picked up steam in recent months, but has accelerated in recent weeks, and threatens to become even worse, with more ratings downgrades likely and possibly key officials falling victim to the downturn.

    Markets have plunged in recent days, with the real breaking 3.80 against the dollar in Thursday morning trading in Sao Paulo, and local analysts say they probably have not hit bottom yet.

    "We haven't yet seen large scale capital flight or a currency crisis, but we might if the current situation continues," Luciano Rostagno, chief economist for Banco Mizuho's Brazil unit, told MNI Thursday.

  • 2015-08-27 17:33


    * That overnight 5.3% rise in the Shanghai Composite Index went a long way to calm fragile nerves in Europe and North America Thursday, with U.S. and other global equity markets rebounding with gusto as a result. There were other signs of improved risk appetite, in oil, U.S. Treasury yields and the dollar, but the day's closes were still not enough to thoroughly convince global investors that the carnage is indeed over. The S&P 500 closed up 2.43% at 1,987.66, after trading in a 1,942.77 to 1,989.60 range. At the close, the index is down 3.5% year-to-date and down 6.9% from the life-time high of 2,134.72, seen May 20. While promising, the S&P 500 will need to decisively clear the 2035-2045 zone that the "all clear" will be sounded, traders said. Prices of U.S.

  • 2015-08-26 16:51


    * U.S. stocks investors appeared to have come around to agree with Fitch Ratings, which said the panic over China's economic outlook may be overdone, because by the close Wednesday, the Dow industrials and the S&P 500 both closed up nearly 4% and the Nasdaq had an even better showing, up 4.24%. China has been at the center of the recent pandemonium in the global financial markets with its actions sending the stock markets into a frenzy and pushing commodity prices down. Earlier in the week, however, it was a lot different. Global markets started this week on a manic sell-off, a panic set off when the China stock exchange collapsed on what was dubbed Black Monday. Red bled across the board, and tech and energy-related stocks were hammered that day.

  • 2015-08-25 15:08


    * The appetite for housing cooled with the collapse in home prices in the Great Recession but following "encouraging" data Tuesday, more than one analyst is watching the green shoots grow with the suggestion there is more upside to come. Indeed, housing has been on a tear lately with statistics showing buyers attempting to get in ahead of an expected rate hike from the Federal Reserve which would feed into higher rates for borrowers. The latest new home sales report for July "was very encouraging, and it will certainly add more confidence on housing sector recovery momentum as the existing home sales report came out also strong last week," Cheng Chen, U.S.

  • 2015-08-24 16:30


    * Huge volume, more big losses and then apprehension about Tuesday and what China may or may not do overnight - that was the story of U.S. stocks Monday in a day of wild volatility that cut another 3.58% from the Dow Jones industrials - 588 points, 3.94% from the S&P 500 and 3.82% from the Nasdaq composite. Several hours earlier it had been much worse, stock losses in the 6% range after the open, making the rest of the day, despite the choppy volatility, look like a sort of stabilization. The Treasuries market was able to end only modestly higher, with a 10-year at a 1.964% yield. Investment grade corporate bond spreads hit new wides and new issuance shriveled. Upcoming are the Treasury's $90 billion 2-, 5-, and 7-year auctions, as well as a $13 billion 2-year FRN reopening.

  • 2015-08-21 16:44


    * U.S. stock indexes fed on their own declines, as computer trading compounded the losses on an otherwise quiet Friday without obvious domestic triggers as the VIX "fear index" showed a record worsening. Analysts reached for reasons, from the day's options expirations to overnight weak numbers on Chinese manufacturing and perhaps an August panic as trading rooms carried on without the senior managers who are on vacation. But for whatever reason at the end of the trading day, the Dow industrials average was back close to where it was last October and the numbers qualified for the rule of thumb for a 10% "correction" for the Dow and Nasdaq. The Dow had dropped 3.12% on top of a steep decline Thursday to land at 16,459.75, 530.94 below Thursday's close.

  • 2015-08-19 16:53


    * The minutes of the latest Federal Open Market Committee did not explicitly tip the hand of the members towards a September liftoff of the fed funds rate, but they also did not rule it out. "The Committee concluded that, although it had seen further progress, the economic conditions warranting an increase in the target range for the federal funds rate had not yet been met," the minutes said Wednesday. "Members generally agreed that additional information on the outlook would be necessary before deciding to implement an increase in the target range." The minutes shed little light on any future timing of rate hikes among the 10 voting members, with no mention of September or upcoming meetings.

  • 2015-08-19 16:47


    * The minutes of the latest Federal Open Market Committee did not explicitly tip the hand of the members towards a September liftoff of the fed funds rate, but they also did not rule it out. "The Committee concluded that, although it had seen further progress, the economic conditions warranting an increase in the target range for the federal funds rate had not yet been met," the minutes said Wednesday. "Members generally agreed that additional information on the outlook would be necessary before deciding to implement an increase in the target range." The minutes shed little light on any future timing of rate hikes among the 10 voting members, with no mention of September or upcoming meetings.

  • 2015-08-18 17:14


    * Listless summer markets were the order of the day Tuesday, with little happening in most instruments. U.S. Treasury yields and the dollar nudged higher, at least versus most majors, while commodities were mixed and U.S. stocks edged lower. Ten-year U.S. Treasury yields last traded around 2.197%, on the high side of the day's range of 2.140% to 2.203%. On the FX front, the dollar was rangy against most currencies, and held a firmer tone versus the majors than emerging market currencies. The euro was trading at $1.1033 and dollar-yen at Y124.37, after holding in respective ranges of $1.1017 to $1.1094 and Y124.18 to Y124.51. NYMEX August light sweet crude oil futures settled up $0.75 at $42.62 per barrel, after trading in a $41.43 to $42.90 (after hours) range.

  • 2015-08-17 17:20


    * The Dallas Federal Reserve Bank, no longer represented by home-state champion and sometime Fed policy skeptic Richard Fisher, went to the Ivy League and Goldman Sachs for his successor, Harvard Professor Robert Steven Kaplan, the new president effective Sept. 8. Kaplan, 58, is the Martin Marshall Professor of Management Practice and a senior associate dean at the Harvard Business School. The Bank's search committee found someone who not only understands monetary policy but "who also sincerely appreciates the impact decisions made by the Federal Reserve have on people from all walks of life," said Dallas Fed board chair Renu Khator, chancellor of the University of Houston.