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Currency trading involves risk of loss.
Leverage magnifies both gains and losses.
Few markets escaped Thursday’s turmoil in markets worldwide and the Brazilian stock market was no exception.
At one stage, losses reached almost five percent as the market lost a significant proportion of the notable gains this year.
Thursday’s huge losses came as a result of a wholesale pullout of Brazil stocks by foreign investors. It is thought that Brazilian investors followed suit, adding to the benchmark Ibovespa stocks index’s woes.
On Friday, uncertainties even prompted a number of Brazilian companies to postpone operations on both domestic and overseas markets, and more were expected to follow.
Meanwhile, the Brazilian Real also weakened significantly against the US dollar. As financial market volatility failed to dissipate on Friday the real opened at 1.938 to the dollar, compared to 1.929 at close Thursday.
Brazilian markets also reacted negatively Thursday to the U.S. worries. Stocks plunged and the real lost ground against the U.S. dollar.
The Mexican peso did little better as it dipped to a three-month low against the US dollar.
It closed at 10.99 against the dollar in contrast to 10.9445 at opening. This has brought total losses against the dollar to about two percent this week.
13:25
Posted on Jul-28-2007
