January 2010, Brazilian Stock Market Participants

The chart below, Figure 1, reflects a comparative view of stock market activity from
October 2008 through January 2010. The January numbers are projected as lower than
December, which reflects the few business days in January (there are five weekends) and
the fact that much of Brazil`s population is on vacation for at least the first few weeks of
January. However, the turbulence of recent days, January 20 & 21, when the Ibovespa
fell 2.43% and 2.83% respectively, may provide higher numbers.

Figure 1
Bovespa - Monthly Volumes
October '08 - December '09
200.00
R$ billions

150.00

100.00

50.00

0.00
D

Ju

D
O

Ja 8

Fe

A 9

Ju 9

O 9

Ja 9
ec

ug

ep

ec
ov

pr

ov
ct

ct
ar

ay

l-0
n-

n-

n-
b-
-0

-0

-0
-0

-0

-0

-0

-0
-0

-0
09

-0

09

10
9
09
8

9
9
8

9
Source: BFM: Bovespa

In January, market participations of the five categories that account for more than 99% of
investments showed an exaggerated sales appetite (R$ 1.6 billion) by institutional
investors at the beginning of the month, with principally financial institutions (R$ 770
million), companies (R$ 674 million) and Individuals (R$ 438 million) doing the buying.

Since then there have been no dramatic actions taken, but Individuals and Institutional
investors have driving the buying. Foreigners have either been neutral or sellers.
Figure 2

Principal Market Participants (Daily Net Investment),

1000000 January, 2010

500000
R$ `000`s

0
1/

1/

1/

1/

1/

1/
1/

1/

1/

1/

1/

1/

-500000
10

11

15
12

13

14
5/

6/

7/
4/

8/

9/
10

10
10

10

10

10

/1

/1

/1

/1

/1

/1
0

-1000000

-1500000

-2000000
Individuals Institutional Foreigners Fin Inst Companies
Source BMF Bovespa
Figure 3 shows the monthly participations in the Bovespa by percentage, for the period
between 1st October 08, and January 15th 2010. In terms of long term trends we can see
the activity of foreigners dipping in June, 09 after they had been prime movers in the
recuperation of value in the market after the crisis. There is a further dip in Foreigners
participation after their participation was penalized by the 2% tax in October `09. We can
also see Financial Institutions increasing their participation in the market as Foreigners
have reduced. Institutional Investors, which hold 25% of the market have increased their
participation to 30%.

Figure 3

% Participation in Sock Market Oct 08 - Jan 15, 10

40.0%
30.0%
20.0%
10.0%
0.0%
Fe

M 9

M
O

No

D 8

Ja 8

Ap 9

Ju 9

Ju

Au

Se 9

No

De 9

Ja 9
ec

ar

ay
ct

ct
b-
n-

n-

l-0

n-
r- 0

g-

p-
v-

v-

c-
-0

-0
-0
-0

-0
09

09

10
0
0

0
Individuals Institutional Foreigners
9

09
8

9
Companies Financial Insts Other
Source: BMF Bovespa