Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
The shape of Brazil’s Covid recovery

AJ Bell is an easy to use, award-winning platform Open an account
We've accounts to suit every investing need, and free guides and special offers to help you get the most from them.
You can get a few handy suggestions, or even get our experts to do the hard work for you – by picking one of our simple investment ideas.
All the resources you need to choose your shares, from market data to the latest investment news and analysis.
Funds offer an easier way to build your portfolio – we’ve got everything you need to choose the right one.
Starting to save for a pension, approaching retirement, or after an explainer on pension jargon? We can help.
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Latin America’s largest economy Brazil has suffered a devastating impact from Covid-19 which has translated into a big financial hit.
While the country’s banks haven’t fared as badly as some feared, with bad debts in particular remaining broadly under control, their valuations have suffered as a proxy for the wider country.
This is evident in the fact that when we last looked at this market in detail in July 2019, financials made up nearly 40% of the MSCI Brazil index – now they account for less than 30%.
Another notable takeaway from the sector breakdown of MSCI Brazil is that technology remains under-represented in the Brazilian market at less than 1% of the index. The broader MSCI Emerging Markets index by contrast has tech as the largest individual sector at a little more than 20%.
A report from the OECD published in October 2020 observed that as of 2018, 23% of Brazil’s adult population had never used the internet. The reported further noted that: ‘More fundamentally, the favourable constellation that fuelled growth until the 2014 recession – an increasing labour force coupled with rising commodity prices – now seems to be exhausted.’
The research added that policies to enhance digital transformation had a ‘key role to play’ in tackling the issues the country faces.
This outlook is part of a series being sponsored by Templeton Emerging Markets Investment Trust. For more information on the trust, visit here
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.
Our website uses cookies to give you a better browsing experience.
You can choose to accept all cookies, or control which we use by clicking 'Manage cookies'. To learn more, read our cookie policy.