Marcelo Brazil

Brazil, the Bovespa Index, PBR and Me

I dont think that the hikes in prices had anything to do with the movement on PBR on these last 2 days .... These hike was largely expected by the market, even with 10% hike petrobras still have its prices about 15/20% behind the rest of the world.
S&P Upgrade -- Expected by the market as well, maybe not that soon and this news got a lot of people short on Brazil and Latin America.
Short term this upgrade doesnt change much thing in my oppinion, first for a country to be considered InvestmentGrade it takes 2 Agencys grading the country Investment grade, so Brazil isnt INVESTMENT GRADE yet, but will be soon.
At the same time that a country wich receives IG receives money from funds and other financial institutions that must invest on IG countries it looses money from institutions that seek high yields investments, and this count (Money in - Money out) is not yet well understood.
IG is sure GREAT GREAT news, but in long term, brazilian companies can borrow money from international market much cheaper now, its easier for them to negotiate contracts worldwide, but the effect will take at leats 1 or 2 years to show on balance sheets ....

But as i said couple of days ago .... if you dont have PBR on your portfolio you should .... if you have KEEP it and buy more when the market give you a good opportunitie (and it gives from time to time)...
Also works for RIO (vale do Rio Doce) another great Brazilian companie...

anyone who wants to discuss about international companies can reach me on [e-mail]...