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Bovespa halted on 10% drop
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January 13, 1999: 10:04 a.m. ET
Brazil's main index plunges after real devalued and central bank chief quits
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NEW YORK (CNNfn) - Brazil's Bovespa index was halted at limit-down shortly after the open of trading Wednesday as traders sold in a rush following the resignation of Brazil's central bank president and the widening of its currency's trading band against the dollar.
Barely 17 minutes into already-delayed trading, activity on the Brazil stock exchange was halted for 30 minutes after the Bovespa plunged 605 points to 5,310, a 10.2 percent drop. A 10 percent drop triggers a trading halt.
After the Sao Paulo Stock Exchange reopened trading at 12:46 p.m. local time -- 9:45 a.m. EST - -the Bovespa stabilized slightly at 5,363, down 553 points or 9.3 percent.
The careering stock prices came on word Central Bank President Franco had resigned, to be replaced by interim president Francisco Lopes.
Meanwhile, the central bank announced it would scrap its currency exchange "mini band" between the Brazilian real and the U.S. dollar. The new "maxi band" was set to trade in a range of 1.20 to 1.32 to the dollar.
As a result, the real quickly plunged to the lower limit of that range, quoted recently at 1.32 to the dollar.
That effective devaluation, which many currency market watchers had been fearing, was followed by remarks from Lopes that the real could face a nominal devaluation of 12 percent against the dollar in 1999. 
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