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Brazilian stocks lapse into loss as Wall Street fades

RIO DE JANEIRO: Brazilian stocks slipped into negative territory by closing time Thursday as mixed signals on Wall Street cast a shadow over sparkling performers in the local power sector, traders said.

The Sao Paulo Stock Exchange's Bovespa index of leading shares ended 0.1 percent lower at 17,081 points, after advancing to 17,422 earlier in the session as local buyers picked up potentially lucrative electricity companies.

"The entire world is watching the Dow Jones, which is not recovering as strongly from the last fall and is scaring people a little," Carlos Hokama, a Credibanco fund manager, said.

The Dow Jones industrial average, the US blue-chip gauge, was up slightly when the Brazilian bourses closed, but the market has been weak amid concerns that the US Federal Reserve might raise interest rates more than expected. The Dow closed off 0.05 percent.

Higher US rates could undermine foreign investment in Brazil, as they make yields in the riskier emerging market instruments less attractive.

Even so, shares of Brazil's electric utilities bounced back on Thursday and boosted total trade volume to 832 million reais after a series of stock offers Wednesday allowed their foreign owners to consolidate their control of the local firms.-Reuters