Amid a corruption scandal at Petrobras (NYSE: PBR), Brazil’s state-run oil company and one of EWZ’s largest holdings, high interest rates, a rising current account deficit and slack economic growth, investors yanked $453.5 million from EWZ in the first quarter.
Petrobras surged 5.3% on nearly triple the average daily volume Thursday after the company said its corruption scandal will cost it at least $2.1 billion. With the stock up 60% in the past month and having closed at its best levels since December yesterday, it is not a stretch to say markets have priced in the worse for Latin America’s largest publicly traded oil company. That is good news for BRZU and EWZ.
Direxion Daily Brazil Bull 3x Shares
Chart Courtesy: Bloomberg