Symbol: PRB.BR

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

Please refer to the attached PDF for the full report.

 

  • Brazil’s Bovespa index rose by 2.6% last week and hit a new 52-week high. The Brazilian market was shifted to a Confirmed Uptrend from a Rally Attempt. We recommend clients add risk in Brazilian equities.
  • Mexico’s main benchmark gained 2% last week. It is below the 200-DMA and is trading 8% off-highs. The index remains in a Rally Attempt. We recommend investors wait for a follow-through day to add risk in Mexican equities.
  • We added Rede Dor Sao Luiz (RD2.BR, RDOR3 BZ) to the Focus List, taking the total number of Focus List stocks in the Latam region to six.
  • Stocks of interest: Petro Rio (HRT.BR, PRIO3 BZ), Vibra Energía (PRB.BR; VBBR3 BZ), Banco Pan (PMP.BR, BPAN4 BZ), Itau Unibanco (IU4.BR; ITUB4 BZ) and Porto Seguro (PSO.BR, PSSA3 BZ).

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

Please refer to the attached PDF for the full report.

 

  • Brazil’s Bovespa was up 0.1% last week. The Brazilian market remains in a Downtrend. The next level of support is at the 200-DMA (112K). We recommend clients remain cautious.
  • Mexico’s main benchmark was up 1.5% last week. The Mexican market was shifted to a Rally Attempt as it held above its recent low. We recommend clients remain cautious and wait for a follow-through day to add risk in Mexican equities.
  • The total number of Focus List stocks in the LATAM region remains at five. None are actionable. 
  • Stocks of interest: Inter (IP9.BR; INBR32:BZ), Banco Do Brasil (IO3.BR; BBAS3:BZ), Ultrapar (U3G.BR; UGPA3:BZ), BRF Brasil Foods (DG3.BR; BRFS3:BZ), Caixa Seguridade (CS6.BR; CXSE3:BZ), Petrobras (POB.BR; PETR4:BZ), Fomento Economico Mexicano (FMU.MX; FEMSAUBD:MM), and Qualitas (QCC.MX; Q*:MM). Additional names are listed on page 3.

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

Please refer to the attached PDF for the full report.

  • Brazil’s Bovespa was down 2.3% last week. The index was shifted to a Downtrend from a Rally Attempt as it broke below
    near-term support at 113,284. We recommend clients remain cautious and avoid adding risk in Brazilian equities.
  • Mexico’s main benchmark was down 2.2% last week. It was shifted to a Downtrend from a Rally Attempt as it broke below
    support at 48,485. We recommend clients remain cautious and avoid adding risk in Mexican equities.
  • We removed MercadoLibre (MELI) from the Focus List. The total number of Focus List stocks in the LATAM region is now
    down to five. Petro Rio (HRT.BR; PRIO3:BZ) is actionable.
  • Stocks of interest: Banco Do Brasil (IO3.BR; BBAS3:BZ), Ultrapar (U3G.BR; UGPA3:BZ), BRF Brasil Foods (DG3.BR;
    BRFS3:BZ), Caixa Seguridade (CS6.BR; CXSE3:BZ), Inter & Co. (IP9.BR; INBR32:BZ), Vibra Energia (PRB.BR; VBBR3:BZ)
    and Qualitas (QCC.MX; Q*:MM). Additional names are listed on page 3.

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

 

Please refer to the attached PDF for the full report.

 

  • Brazil’s Bovespa index gained 1.8% last week, closing above its 50-DMA. The Brazilian market remains in a Rally Attempt.
  • Mexico’s benchmark index gained 0.2% last week and remains in a Confirmed Uptrend. It recorded its first distribution day last Tuesday as it hit resistance near its declining 200-DMA.
  • The number of Focus List recommendations is unchanged at nine. Actionable stocks include IRB Brasil Resseguros (IRB.BR; IRBR3 BZ) and Natura Cosmeticos (NAT.BR; NATU3 BZ).
  • Off the Focus List, stocks of interest include Duratex (SAT.BR; DTEX3 BZ), Raia Drogasil (DR3.BR; RADL3 BZ), Fleury (FLE.BR; FLRY3 BZ), Kimberly Clark Mexico (KCA.MX; KIMBERA MF), Walmart de Mexico (WAV.MX; WALMEX* MF), Fibra Uno (FUN.MX; FUNO11 MF), and Bancolombia (BCB.CO; PFBCOLO CB).

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

Please refer to the attached PDF for the full report.

  • Brazil’s Bovespa index gained 3.5% last week. It was moved to a Rally Attempt from a Downtrend as the benchmark bounced off support near the 200-DMA.
  • Mexico’s benchmark index gained 6.9% last week and was upgraded to a Confirmed Uptrend from a Rally Attempt. We note that the benchmark remains below the 200-DMA. A sustained move above this resistance level would be bullish.
  • The number of Focus List recommendations is down to nine. We removed Banco Btg Pactual (BPC.BR; BPAC11 BZ) and Banco Do Brasil (IO3.BR; BBAS3 BZ) last week.
  • Off the Focus List, stocks of interest include Kimberly Clark Mexico (KCA.MX; KIMBERA MF), Walmart de Mexico (WAV.MX; WALMEX* MF), Fibra Uno (FUN.MX; FUNO11 MF), Fleury (FLE.BR; FLRY3 BZ), and Petrobras Distribuidora (PRB.BR; BRDT BZ).

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

 

Please refer to the attached PDF for the full report.

 

  • Brazil’s Bovespa index lost 2.1% last week. Due to its high distribution day count and a breach of its 100-DMA, the market was downgraded to a Downtrend from an Uptrend Under Pressure.
  • In contrast, Mexico’s benchmark index gained 1.3% last week and was moved to a Rally Attempt from a Downtrend as it bounced from year-to-date lows.
  • The number of Focus List recommendations is down to 11. We removed Linx (LIX.BR; LINX3 BZ) on Friday, August 23 as the stock breached its 200-DMA and continued to face strong selling pressure.
  • Off the Focus List, stocks of interest include Kimberly Clark Mexico (KCA.MX; KIMBERA MF), Walmart de Mexico (WAV.MX; WALMEX* MF), Fleury (FLE.BR; FLRY3 BZ), and Petrobras Distribuidora (PRB.BR; BRDT BZ).

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

 

Please refer to the attached PDF for the full report.

 

  • Brazil’s Bovespa index lost 4% last week after adding two distribution days, taking its total count to seven. The market has been moved to an Uptrend Under Pressure from a Confirmed Uptrend given high distribution day count and volatility.
  • Mexico’s benchmark index lost 2.7% last week. The market was moved to a Downtrend from a Rally Attempt after it made a new year-to-date low.
  • The number of Focus List recommendations remains at 12. There are two actionable stocks: Natura Cosmeticos (NAT.BR; NATU3:BZ) and Interconexion Electrica (ISA.CO; ISA CB). IRB Brasil Resseguros (IRB.BR; IRBR3 BZ) is also close to its pivot of BRL 102.
  • Off the list, stocks of interest include Bancolombia (BCB.CO; PFBCOLO CB), Petrobras Distribuidora (PRB.BR; BRDT BZ), Hypermarcas (HYP.BR; HYPE3 BZ), and Duratex (SAT.BR; DTEX3 BZ).

 

LATAM Weekly Summary

Posted on by Romeo Alvarez

Key points from this week’s report:

Please refer to the attached PDF for the full report.

  • Brazil’s Bovespa index gained 1.3% last week after finding support at the 100,000 psychological level. It added one distribution day (and one expired), taking its total to five. The Brazilian market remains in a Confirmed Uptrend.
  • Mexico’s benchmark index gained 1.1% last week after declining for four consecutive weeks and being more than 20% off highs. We moved the Mexican market to Rally Attempt on August 8.
  • The number of Focus List recommendations remains at 12. Actionable stocks include Natura Cosmeticos (NAT.BR; NATU3 BZ) and Iguatemi (IGU.BR; IGTA3 BZ).
  • Off the list, stocks of interest include Fleury (FLE.BR; FLRY3 BZ), Hering Textil (3HG.BR; HGTX3 BZ), Petrobras Distribuidora (PRB.BR; BRDT3 BZ), and Bancolombia (BCB.CO; PFBCOLO CB).

LATAM Weekly Summary

Posted on by Romeo Alvarez

Argentina: Confirmed Uptrend
Brazil: Uptrend Under Pressure
Mexico: Confirmed Uptrend
Commentary
Last week, Brazil’s main equity benchmark fell 2.62% after advancing for six consecutive weeks. Due to the elevated number of
distribution days and the lack of new breakouts in leading stocks, we moved Brazil’s market to an Uptrend Under Pressure from a
Confirmed Uptrend. Although Brazil continues to be one of the best emerging markets globally, many leading names are now
extended from proper buy points or are in the process of forming new bases. We believe the Bovespa benchmark is poised to
test support at the 50‐DMA or ~91,800 level on profit taking. Leading sectors are those with direct exposure to the domestic
economy, including Transportation, Health Care, Utility, Financial, Retail, and Consumer Cyclical. The Utility sector is currently
the absolute best sector in Brazil, mostly due to the expectations of industry privatization.