Equities: Major Storm Clouds Gathering

With global markets starting the week on a very shaky footing, our long-standing bearish bias towards the Brazilian Bovespa and the Mexican IPC equity indices remains firmly in place. Technical and momentum indicators on the bourses are giving increasingly negative signals, and with our cautious macroeconomic outlook on both economies yet to be fully priced in by investors, in our view, we believe that a major downleg could be on the cards.

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