Inflation Drives Brazil Stocks to Bear Market
By Alexander Cuadros and Ney Hayashi
Brazilian stocks approached a bear market, with the benchmark index down 20 percent from a November high, as quickening inflation fueled concern earnings growth will flag in the world’s second-largest emerging economy.The Bovespa fell 1.6 percent in Sao Paulo to 58,398.49 at 11 a.m. New York time, extending the worst performance this year among major equity markets. A close at this level would indicate a bear market, typically defined as a drop of at least 20 percent from the preceding bull-market peak. The real tumbled 1.8 percent to 1.5665 per dollar today after the government said it will levy a tax on some investments in currency derivatives.
“These measures reinforce the negative sentiment that foreign investors already had on Brazil,” said Eduardo Favrin ...
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