October 27, 2007

Market is skyrocketing in Brazil

Shares of Brazil's Bovespa stock exchange soared Friday after setting a Brazilian initial public offering record, drawing in so many dollars from foreign buyers that Brazil's currency rose sharply against the greenback. Shares of Bovespa - Brazil's principle exchange - rose 39 percent as they began trading following a long-awaited IPO that raised $3.7 billion for the exchange's owners. The exchange's shares opened at $17.77 per share, far above Thursday's $12.77 per share IPO price. Bovespa sold 288 million shares in the IPO and demand was so strong internationally that dollars poured into Brazil, flooding the market with greenbacks.

The Bovespa is owned by a group of 292 banks, brokerages and individual investors who are expected to pocket the proceeds of the IPO. Among its biggest stake holders are Grupo Itau, the controlling shareholder of Brazilian bank Banco Itau SA, and Grupo Santander Banespa, a Brazilian division of Spain's Banco Santander SA

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