BOVESPA

Recent chart:  http://www.bloomberg.com/apps/quote?ticker=IBOV%3AIND

 

Table of Contents

BOVESPA BOVESPA + BM&F  Commodities: Issues: Publicly owned stock exchange: Importance of FOREIGN investors: News:  Question: why is the BOVESPA worth more than the NYSE? Wikipedia info on BOVESPA History List of Companies traded on BOVESPA

 

   see also:  how to invest in Brazil ,  Brazil: Economy

 

 

BOVESPA + BM&F 

 

 

Commodities:

 

commodity producers Petroleo Brasileiro SA and Cia. Vale do Rio Doce, which together make up about two-fifths of the gauge.

 

 

 

follows closely the price of oil and other commodities.  Anyone why buys the index in Brazil has a big exposure to these two asset classes— Petrobras, the state-controlled oil company, and Vale, a global mining company, together account for just over 30% of the Bovespa's total market value. Other agricultural producers also carry a lot of weight. This bias towards commodities makes the Bovespa rather more like Australia's All Ordinaries index than like stockmarkets in India or China.

 

Issues:

Low trading volumes, a sharp downturn in the number of IPOs and international market conditions have weighed heavily. Bovespa is highly dependent on foreign investors, who were responsible for some 70 per cent of IPOs purchases last year.  “To improve performance, the exchanges will need to increase trading and revenues. To do this, they need to offer a wider range of products, in areas such as equity derivatives and options, and stimulate liquidity in mid- and small-cap cash-traded shares,” said Ricardo Kobayashi, co-head of asset management at UBS Pactual in Rio de Janeiro.  The exchanges said the merger would squeeze expenses by 25 per cent up to 2010. “That looks achievable, if aggressive,” Mr Kobayashi said.

 

Publicly owned stock exchange:

Bovespa Holding’s IPO in November saw shares debut at R$23 and leap more than 50 per cent on the first day. Since then, they have dropped and were trading at R$26.60 on Wednesday March 2008. BM&F’s shares were launched at R$20 and had a similar trajectory. On Wednesday they were trading at R$17.60.  Shareholders of BM&F and Bovespa will each own 50 per cent of the new company and Bovespa’s shareholders will receive a R$1.24bn ($715m) payout to compensate for its higher market value.

 

Proposed new name: "Nova Bolsa"

 

 

 

Importance of FOREIGN investors:

 

Foreign investors sold 646 million reais ($280 million) more than they bought in stocks last month, exchange owner BM&FBovespa SA said this week in a statement on its Web site. Investors last year withdrew a record 24.6 billion reais as the benchmark Bovespa index plunged 41 percent, the most ever. source:  http://www.bloomberg.com/apps/news?pid=20601086&sid=a7k7UlvAUR38&refer=latin_america

 

 

 

News: 

Mar 26, 2008 ,  Bovespa Holding, which controls the São Paulo Stock Exchange, and the BM&F, Brazil's main futures exchange, gained approval from their boards for a merger that will create the second-largest exchange in the Americas.  read more:   http://www.ft.com/cms/s/0/656121b8-fb67-11dc-8c3e-000077b07658.html

 

 

 

 

 

 

 read more about the merger (Portuguese):  http://www.terra.com.br/istoedinheiro/edicoes/543/artigo73294-2.htm

 

 

 

Question: why is the BOVESPA worth more than the NYSE?

 

see:   how to value a publicly traded stock market

 

 

Wikipedia info on BOVESPA

 

http://en.wikipedia.org/wiki/Bovespa

 

Bovespa - São Paulo Stock Exchange (Portuguese: Bolsa de Valores de São Paulo). Located in the heart of the biggest Brazilian city, São Paulo, Bovespa is the largest stock exchange in Latin America. On an average day (in 2004 figures), shares valued at R$ 1,221.3 million were traded on Bovespa , where US$1.00 = R$1.91 approximately. Established in August 23, 1890 on Rua 15 de Novembro, it was a state institution until 1966, when it became a non-profit civil association.

 

Bovespa is linked to all Brazilian stock exchanges, including Rio de Janeiro's Boverj, where only government bonds are traded.

 

Brazilian stocks rise and fall depending on a number of factors, including the direction of monetary policy as determined by the SELIC rate of the Brazilian Central Bank. The benchmark indicator of Bovespa is the 50-stock Índice Bovespa.

 

On Bovespa, preferred stock ('Preferencial Nominativa' in Portuguese, or simply 'PN') is sometimes the most-traded class of stock for a particular company, although common stock (Ordinária Nominativa, or 'ON' in Portuguese) is also available for trading.

 

The number of companies traded at Bovespa is close to 550, according to the Bovespa website.

 

During January 2006 Bovespa reached a record mark with 38.382 points, which is about R$2.9 billion reais, with the capital movement of 2.5 billion of reais about US$1.3 billions negotiated in the same month.

 

On April 9 2007, Bovespa set a record mark with 50,0 thousand points, which represents R$4.02 billion reais. On May 9 2007, Bovespa set a record mark with 51,300, which represents R$4.78 billion reais.

 

 

 

History

 

Organised on August 23, 1890 by Emilio Rangel Pestana, the "Bolsa de Valores de São Paulo" (São Paulo Stock Exchange, in English) has had a long history of services provided to the stock market and the Brazilian economy. Until the mid-1960s, Bovespa and the other Brazilian stock markets were state-owned companies, tied with the Secretary of Finances of the states they belonged to, and brokers were appointed by the government.

 

After the reforms of the national financial system and the stock market implemented in 1965/1966, the Brazilian stock markets had assumed the institutional role that keep until today, changing to non-profit civil associations, with administrative, financial and patrimonial autonomy. The old individual figure of the broker of government securities was substituted by the commercial broker.

 

Through self-regulation, Bovespa operates under the supervision of the "Comissão de Valores Mobiliários" (CVM or Commission of Movable Values in Portuguese), analogous to the American SEC. Since the 1960s, it has constantly evolved with the help of technology such as the introduction of computer-based systems, mobile phones and the internet. In 1972, Bovespa was the first Brazilian stock market to implement an automated system for the dissemination of information on-line and in real time, through an ample network of computer terminals

 

 

At the end of the 1970s, Bovespa also introduced a telephone trading system in Brazil; the "Sistema Privado de Operações por Telefone" (Private System of Operations by Telephone, in Portuguese), the SPOT. At the same time, Bovespa developed a system of fungible safekeeping and online services for brokerage firms.

 

In 1990, the negotiations through the Sistema de Negociação Eletrônica - CATS (Computer Assisted Trading System) was simultaneously operated with the traditional system of "Pregão Viva Voz" (Live Voice Trading). Currently, the Bovespa is a completely eletronic market, as all trades are performed via the electronic system.

 

In 1997, a new system of electronic negotiation of the Bovespa, the Mega, was implemented successfully. The Mega extends the potential volume of processing of information and allows that Bovespa to increase its overall volume of activities.

 

With the goal to increase popular access to the stock markets, Bovespa introduced in 1999 the "Home Broker" and "After-Market", both electronic trading systems allowing small and medium-size investors to participate in trading. The Home Broker system allows users to immediately execute sell and buy orders inside the stock exchange remotely using the internet. The "After-Market" is an evening trading service, where trades are performed even after the market has closed.

 

List of Companies traded on BOVESPA

 

http://en.wikipedia.org/wiki/List_of_companies_traded_at_Bovespa

 

Acesita (ACES4) - siderurgy and metallurgy; HQ: Belo Horizonte

AmBev (AMBV4) - food and beverages; HQ: São Paulo

Aracruz (ARCZ6) - pulp and paper; HQ: São Paulo

Banco do Brasil (BBAS3) - finance and insurance; HQ: Brasília

Bradesco (BBDC4) - finance and insurance; HQ: Osasco

Bradespar (BRAP4) - other / holding company; HQ: São Paulo

Brasil Telecom (BRTO4) - telecommunications; HQ: Brasília

Brasil Telecom Participações (BRTP3; BRTP4) - telecommunications; HQ: Brasília

Braskem (BRKM5) - chemicals; HQ: São Paulo

Caemi (CMET4) - mining; HQ: Rio de Janeiro

Celesc (CLSC6) - energy; HQ: Florianópolis

Cemig (CMIG3; CMIG4) - energy; HQ: Belo Horizonte

CESP (CESP4) - energy; HQ: São Paulo

Comgás (CGAS5) - oil and gas; HQ: São Paulo

Companhia Siderurgica Nacional (CSNA3) - siderurgy and metallurgy; HQ: Rio de Janeiro

Copel (CPLE6) - energy; HQ: Curitiba

Eletrobrás (ELET3; ELET6) - energy; HQ: Rio de Janeiro

Eletropaulo (ELPL4) - energy; HQ: São Paulo

Embraer (EMBR3; EMBR4) - vehicles and parts; HQ: São José dos Campos

Embratel Participações (EBTP4) - telecommunications; HQ: Rio de Janeiro

Gerdau (GGBR4) - siderurgy and metallurgy; HQ: Porto Alegre

Gerdau Met (GOAU4) - siderurgy and metallurgy; HQ: Porto Alegre

Ipiranga Petróleo (PTIP4) - oil and gas; HQ: Rio de Janeiro

Itaubanco (ITAU4) - finance and insurance; HQ: São Paulo

ItaUSA (ITSA4) - other / holding company; HQ: São Paulo

Klabin (KLBN4) - paper and pulp; HQ: São Paulo

Light (LIGH3) - energy; HQ: Rio de Janeiro

Net (NETC4) - other / cable TV; HQ: São Paulo

Oi (TMAR5; TNLP3; TNLP4) - telecommunications; HQ: Rio de Janeiro

Petrobras (PETR3; PETR4) - oil and gas; HQ: Rio de Janeiro

Sabesp (SBSP3) - other / sanitation; HQ: São Paulo

Siderúrgica Tubarão (CSTB4) - siderurgy and metallurgy; HQ: Serra

Souza Cruz (CRUZ3) - other / tobacco; HQ: Rio de Janeiro

Telemig Celular Participações (TMCP4) - telecommunications; HQ: Brasília

TIM Participações (TCSL3; TCSL4)) - telecommunications; HQ: Rio de Janeiro

Tractebel Energia (TBLE3) - energy; HQ: Florianópolis

Transmissão Paulista (TRPL4) - energy; HQ: São Paulo

Unibanco (UBBR1) - finance and insurance; HQ: São Paulo

UOL (UOLL4) - online service provider and internet service provider; HQ: São Paulo

Usiminas (USIM5) - siderurgy and metallurgy; HQ: Belo Horizonte

Vale do Rio Doce (VALE3; VALE5) - mining; HQ: Rio de Janeiro

Varig - transportation HQ: Porto Alegre

Vivo Participações (VIVO3; VIVO4) - telecommunications; HQ: São Paulo

Votorantim Celulose e Papel (VCPA4) - paper and pulp; HQ: São Paulo

WEG (WEGE4) - metallurgy, energy and electric motors 2; HQ: Jaraguá do Sul

 

 

 

 

 

 

 

 

 

 

 

 

 

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