Brazil's currency weakened on Friday and stocks fell to their lowest level in almost eight weeks as investors sold off blue chip stocks weighed down by a slump in US equity markets. The Sao Paulo Stock Exchange's benchmark Bovespa index fell 1.04 percent to 65,896 points, heading for its weakest level since April 29.
Shares of Brazil's two biggest airlines, TAM Linhas Aereas and Gol Linhas Aereas, tumbled after Fitch Ratings downgraded Gol and said it may cut TAM. Brazil's currency, the real, weakened 0.25 percent to 1.608 per US dollar.
Expectations of profit warnings from US financial firms and lower dividends pushed Wall Street stocks lower, with the Dow Jones industrials dropping 1.1 percent and the Nasdaq Composite Index tumbling nearly 2 percent. The declines increased investors' risk aversion and pushed Brazil markets lower. "There is only difficult news today," said Americo Reisner, a trader at the Fator brokerage in Sao Paulo.
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