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SBD Global/June 12, 2012/FinancePrint All
Sporting events like Euro 2012 “are known for pushing the stock markets of host countries but last only for a short period of time,” according to Richard Haimann of the FINANCIAL TIMES DEUTSCHLAND. Saxo Bank investment analyst Matt Bolduc said: “Over the last 20 years stock market indexes in the host countries of Summer Olympics did notably better than the global stock market index MSCI.” Haimann wrote, “the Dow Jones had an 18% advantage over the MSCI index after the 1996 Atlanta Olympics.” The same happened in Australia after the 2000 Sydney Games were the ASX index had an 24% advantage and in Greece after the 2004 Athens Olympics were the Athex index was 23% better than the MSCI.” The same holds true for World Cup hosts. The German DAX index "increased by 45%" after the 2006 World Cup. However, those gains "have only a limited duration." Just one year after hosting a big sporting event “most indexes decrease and go along with the worldwide flow” (FINANCIAL TIMES DEUTSCHLAND, 6/11).
The famous Maracana stadium in Rio de Janeiro will receive a R$200M ($98.4M) loan from Banco do Brasil, according to Marcelo Baltar of GLOBOESPORTE. The stadium loan is part of a much larger loan of R$3.6B ($1.72B) by the bank to the state of Rio de Janeiro for city projects. Brazilian President Dilma Rousseff approved the loan and will be in Rio on Wednesday to sign the paperwork. The Rio de Janeiro government has estimated the total cost of the stadium that will host the 2014 World Cup final at R$859M ($423.4M). As of now, the Maracana is 56% finished and should be done by Feb. '13 (GLOBOESPORTE, 6/11).
The price of tickets for football matches in Brazil has grown above the inflation rate of the country, according to AE. For example, in May of this year, while the Consumer Price Index (IPCA) was 0.36 %, ticket inflation was 1.64 %. The rising ticket prices for games being above the inflation rate is not a "recent phenomenon." Since '07 when Brazil was chosen to host the 2014 World Cup until the last month, ticket prices have increased by 127%. Analysts believe that improved infrastructure in stadiums due to Brazil hosting the 2014 World Cup will continue to push ticket prices up. Brunoro Sport Business Dir of New Business Ricardo Hinrichsen said, "What will also happen is that the stadiums will have more areas for a corporate audience" (AGENCIA ESTADO, 6/10).