In Brazil, Dangerous Game of Bottom Fishing Has Begun
- Franklin Templeton among funds buying Brazil assets again
- Key to debate is whether a Rousseff ouster would be good news
As Brazilian President Dilma Rousseff moves ever closer to impeachment, traders are wondering if another end is near: the end of the yearlong market rout.
While most agree it’s too soon to declare either Rousseff’s presidency or Brazil’s stock and bond collapse are over, the debate is gaining steam. Mark Mobius, chairman of the emerging-markets group at Franklin Templeton, says he’s already hunting for bargains among Brazilian stocks that are near their cheapest since 2000. Gam UK Ltd. investment manager Tim Love has ratcheted up holdings of Brazil banks in his portfolio “on valuation grounds alone.” And Solitaire Aquila Ltd. portfolio manager Patrik Kauffmann said he sees an opportunity in beat-up bonds from oil producer Petrobras and state-development bank BNDES.