June 1, 2006
Traders at Brazil's Bovespa fret on a grim market day.Decades of boom and bust cycles in Latin America instill a sense of wariness when things look too good in the region. In April, Dealogic, the capital markets consultancy, produced figures showing an unprecedented pipeline of Latin American equity and M&A deals. Investors, it appeared, could not get enough of Latin stocks. Private equity funds and companies were plugging cash into the region's fast-growing economies.
At the end of May, equity issuance in Latin America reached $7.95 billion, the highest point on record for those five months. M&A activity hit a historic peak with 160 deals announced totaling $29.2 billion. Brazil
After a three-year bull run, Latin America's capital markets are caught in the throes of a market correction. Issuers and investors say they are prepared this time.