| | |  Business News | September 2008 
Brazil Replaces Mexico as Citi's Top Market in Latin America
 Alexander Ragir - Bloomberg
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Citigroup Inc. replaced Mexico with Brazil as its favorite stock market in Latin America and advised investors to buy Brazilian financial, material and phone shares.
Latin American equity strategist Geoffrey Dennis said the Brazilian stock market's valuation "premium" has disappeared after a 40 percent decline since late April, commodity stocks have been "oversold" and earnings momentum is "still solid."
The New York-based bank raised its rating for telephone stocks to "overweight" from "neutral." Citigroup also raised Brazil's energy stocks to "neutral" from "underweight," meaning it advises investors to hold shares of the industry in line with its weighting in the benchmark.
"We are re-installing Brazil as our top market in Latin America and our biggest overweight in the region," Dennis wrote in a note to clients. "We consider this to be an excellent entry point back into the market."
Brazil's Bovespa index has dropped 32 percent from its May 20 high as rising interest rates and falling commodity prices boosted concern that economic growth may slow.
Previously, Mexican stocks were Citigroup's biggest "overweight" in Latin America.
The bank reiterated its "overweight" rating on Brazilian financial and raw material stocks.
To contact the reporter on this story: Alexander Ragir in Rio de Janeiro at aragir(at)bloomberg.net. |
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