US shares of Brazilian financial companies fall as tax reform jolts markets

Nu Holdings

29/11/2024 12:43

** Shares of some Brazilian financial services companies
fall in U.S. premarket trading
    ** XP  XP.O , StoneCo  STNE.O , Nu Holdings  NU.N ,
PagSeguro Digital  PAGS.N , and Inter & Co  INTR.O  fall 5.6%,
4.2%, 2.4%, 1%, and 9.7%, respectively
    ** U.S.-listed shares of Banco Bradesco  BBD.N  fall 4.9% 
    ** Brazil's government after U.S. markets closed on
Wednesday proposed to expand income tax exemptions for
lower-income Brazilians and increase taxes on those who earn
more
    ** That frustrated investors who had expected the focus to
be on spending cuts, with Brazilian real hitting an all-time low
of 6.02 per dollar on Thursday
    ** Itaú BBA says higher taxes on those who earn more could
be worse for legacy banks and investment platforms that are most
exposed to these segments
    ** Brokerage says lower-income players such as NU and BBD
could benefit in the near-term, but the mid-term is more
uncertain as there are concerns about the potential inflationary
pressures the reforms may bring
    ** U.S. exchanges were closed on Thursday in observance of
Thanksgiving holiday

 (Reporting by Arasu Kannagi Basil in Bengaluru)
 ((ArasuKannagi.Basil@thomsonreuters.com;))