Early May – Stock Market Developments

Stock Market in Crisis

April 1 - May 6
110,0%

105,0%

100,0%

95,0%

90,0%

85,0%
2/ 201

4/ 10

6/ 010
8/ 010

2/ 201

4/ 10

6/ 010
31

10 010

12 201

14 201
16 201

18 201

20 201

22 201
24 201

26 201
28 201

30 201
4/

4/

5/

5/

5/
4/

4/
/3

/4 0

/4 0
/4 0

/4 0

/4 0

/4 0

/4 0
/4

/4 0

/4 0

/4 0
2

20 0

20
20 0

2
/

/
/

/
/

/
/
DJI FTSE CAC 40 HSI Ibovespa S&P

10
The stock markets of the world entered into panic today as the Dow Jones index fell
more than 9% at one point. The DJI closed down a more reasonable 3.2%, as did the
other USA index, the S&P, but nonetheless, the world is worried about the debt position
of the Greek Government and its repercussions in other countries such as Spain and
Portugal. In other markets, the CAC 40 was down 2.2%, the FTSE down only 1.5%,
perhaps the fall being mitigated by the expectation of a Conservative Government being
elected today. The Ibovespa was down 2.3%, and the HSI was down 1%, but with the
timing difference their market will be affected at their opening this evening.

However, looking at the time frame of the last 36 days, or since the beginning of April,
we find that the CAC 40 is down 10.5%, the IBovespa is down a full 10%, The FTSE is
down 7.4% and the HIS down 5.2%. The DJI and the S&P have fared a little better at a
loss of 3.1% and 3.5% respectively.

Taking a look at the Brazilian experience we can see funds flowing back to the safe
havens, and the dollar/ real rate, which momentarily reached 1.90 today, having been
1.73 last week, closed at 1.83. A fall in the Ibovespa of 10% can only be seen as a major
readjustment of the value of the Brazilian market.