BN 07/09 02:17 Why UBS Says Brazil’s 7-1 Trouncing Is Bearish for Stock Market
Why UBS Says Brazil’s 7-1 Trouncing Is Bearish for Stock Market
2014-07-09 02:32:25.511 GMT
By Ye Xie and Jenna M. Dagenhart
July 9 (Bloomberg) -- Conventional wisdom was that a Brazil
loss at home in World Cup would be positive for its financial
markets by souring the national mood and prompting voters to
oust Dilma Rousseff.
* Yesterday’s 7-1 loss to Germany was so crushing that it
upends that theory, according to Geoffrey Dennis, the head
of emerging-market strategy at UBS, who’s been covering
Brazil since the early 1990s
* The defeat will hurt Rousseff’s chances at re-election in
October, but the lopsided outcome could deal a blow to
investor and consumer confidence in a country that obsesses
about its national pastime, he said in interview
* “It is such a humiliating defeat that you wonder whether it
will have a negative impact on Brazilians’ psyche,” Dennis
said. “It’s going to confirm to the people that ‘Look, our
economy is struggling, we cannot get any growth, now we
don’t even have a decent football team either.’”
* Rousseff wrote on her Twitter account that she was saddened
by the defeat, also using lyrics of a popular Brazilian song
to urge the nation to overcome the loss
* The game may ultimately cost Rousseff the election, which
will in turn spur a 25% rally in Brazilian stks, said
Alberto Bernal, head of research at Bulltick Capital Markets
* “This is going to be catastrophic for the national mood,”
Bernal said. “If the market sees the potential that Dilma
will not be re-elected, then it will rally in a big way.”
* “I do not think this result leads to a knee-jerk rally in
markets. Brazil has to get over this massive loss:” Dennis
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To contact the reporter on this story:
Grant Clark in Singapore at +65-6212-1101 or
gclark@bloomberg.net
To contact the editor responsible for this story:
Grant Clark at +65-6212-1101 or
gclark@bloomberg.net
2014-07-09 02:32:25.511 GMT
By Ye Xie and Jenna M. Dagenhart
July 9 (Bloomberg) -- Conventional wisdom was that a Brazil
loss at home in World Cup would be positive for its financial
markets by souring the national mood and prompting voters to
oust Dilma Rousseff.
* Yesterday’s 7-1 loss to Germany was so crushing that it
upends that theory, according to Geoffrey Dennis, the head
of emerging-market strategy at UBS, who’s been covering
Brazil since the early 1990s
* The defeat will hurt Rousseff’s chances at re-election in
October, but the lopsided outcome could deal a blow to
investor and consumer confidence in a country that obsesses
about its national pastime, he said in interview
* “It is such a humiliating defeat that you wonder whether it
will have a negative impact on Brazilians’ psyche,” Dennis
said. “It’s going to confirm to the people that ‘Look, our
economy is struggling, we cannot get any growth, now we
don’t even have a decent football team either.’”
* Rousseff wrote on her Twitter account that she was saddened
by the defeat, also using lyrics of a popular Brazilian song
to urge the nation to overcome the loss
* The game may ultimately cost Rousseff the election, which
will in turn spur a 25% rally in Brazilian stks, said
Alberto Bernal, head of research at Bulltick Capital Markets
* “This is going to be catastrophic for the national mood,”
Bernal said. “If the market sees the potential that Dilma
will not be re-elected, then it will rally in a big way.”
* “I do not think this result leads to a knee-jerk rally in
markets. Brazil has to get over this massive loss:” Dennis
Story Link:NSN N8FACO6K50Y8<GO>
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Grant Clark in Singapore at +65-6212-1101 or
gclark@bloomberg.net
To contact the editor responsible for this story:
Grant Clark at +65-6212-1101 or
gclark@bloomberg.net