The volume of transactions effected on the Bovespa in February (R$ 117.

7 billion) was
down 8.2% from the January total (R$ 128.2 billion). Part of this amount may be
accounted for by the one day fewer in February, 18 as opposed to 19 in January, a short
month that also included the Carnaval holiday. When the transactions are reviewed on an
average daily basis, February was only down 3.1%.

Figure 1 shows stock market activity since the start of the global economic crisis, and
February is the lowest activity month since September, 2009.

Figure 1

Bovespa - Monthly Volumes

October '08 - February '10
200.00

150.00
R$ billions

100.00

50.00

0.00
De 8

Ju 9

Au

Se 9

De 9
O

No

Ja 8

Fe

M 9

Ap 9

Ju 9

O 9

No

Ja 9

Fe
ct

ct
ar

ay

l-0
n-

n-

n-
p-
g-
b-

b-
c-

c-
r- 0
v-

v-
-0

-0
-0
09

-0

10
0

0
0
9

0
0

10
8

9
Source: Bovespa

In terms of the activity of the various stock market investor groups, Figure 2. shows the
relative decline of the Foreign investor who reached levels of 37% of market activity in
July 2009, but today, with more limited upside has seen its market participation slip back
to 27%. Institutional Investors, have taken up some of the market participation of the
foreigners, with an increase in participation from 24% - 26% throughout the early part of
the crisis, rising to 29% - 30% in the last four months. Similarly, Financial Institutions
have risen from 5% - 6% to 9% - 10% today. Individuals have been somewhat more
volatile, but in 2010 they have been the largest group of investors with 32%.

Figure 2

40.0% Stock Market Participants Oct 08 - Jan 10

35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
O

Ja 8

Ju 09

N 9

Ja 9

F
D

M 9

Ju 9

D
eb

eb
pr

ug
ov
ct

ep

ct

ov
ec

ar

ec
ay
n-

n-

n-
l- 0
-0
-0

-0
-0

-0

-0

-0

-0

-1
-0

-0

-0

10
09

9
8

0
8

9
9

Individuals Institutional Foreigners Companies Fin Insts Other

Source: Bovespa
Figure 3 shows the net activity of the largest four categories of investors in February.
There was only one category of investor that made net purchases in February,
Institutional Investors. Financial Institutions and Individuals were relatively small
sellers, and Foreigners were larger than the sum of the other two.

Figure 3

Stock Market Activity, February, 2010

$2,000,000
$1,500,000
$1,000,000
R$ '000's

$500,000
$0
-$500,000 1
-$1,000,000
-$1,500,000

Foreigners Institutional Individuals Fin Inst

Source: Bovespa

Figure 4 shows the performance of the Ibovespa index from January 1st, through
February, 26th, the last day of business. The 2010 story is one of a decline of the Index by
3.0%, with a rise of 1.7% in February. After three days trading in March, the Ibovespa is
up 1.8%.

Figure 4
Ibovespa in Jan/ Feb
72000
71000
70000
Ibovespa

69000
68000
67000
66000
65000
64000
63000
62000
1/

1/

1/

1/

2/

2/

2/

2/
8/
4/

11

18

25

1/

15

22
20

20

20
/2
/2

/2

/2

/2
1

0
0

10

10

10

10

10

Source: Ibovespa

The above analysis would seem to suggest that the drivers of value growth in the
Brazilian Stock market have been the Foreign Investors. Many still have significant
positions in Brazil, but in terms of incremental growth there would not appear to be any
strong argument at present that would induce any of the major categories of investors to
push values much higher.