Latin America Stocks Feel Shock Waves

Stock markets plunged across Latin America from Mexico City to Buenos Aires on Monday in a furious selling bout unleashed by Asia’s currency crisis.

In Brazil, the Sao Paulo Stock Exchange posted its fourth-biggest dive in its 107-year history amid a wave of panic selling. “Banks were selling at any price,” said one unidentified trader. In Latin America, traders rarely give their names when they speak from the floor.

The Sao Paulo Stock Exchange’s Bovespa Index closed down 1,729 points, or 14.9 percent, at 9,816, while the Rio de Janeiro Stock Exchange Index gave up 5,957 points, or 13.9 percent.

In neighboring Argentina, shares on the blue-chip Merval Index fell 13.7 percent - the market’s biggest drop since the Tequila Effect, the term used to describe Mexico’s devastating 1994-95 financial crisis, sent waves of investors packing from the region.

“The whole market was in crisis. Everyone was trying to salvage any gains they could for this year,” one trader said.