Why MercadoLibre Stock Fell Nearly 6% Today
Shares of MercadoLibre (NASDAQ: MELI) were down 5.8% as of 12:15 p.m. ET. Latin America's e-commerce and financial technology leader was being dragged down along with other growth stocks following last week's signal from the U.S. Federal Reserve that interest rates might need to be raised faster than originally planned to fight inflation. Paired with the emergence of the omicron coronavirus variant in late November, it's been a tough couple of months for the stock. MercadoLibre is now down some 40% from its last peak in the early autumn of 2021.
For MercadoLibre, which is listed on U.S. stock exchanges, higher interest rates means a lower present stock value. But that's not all the company is contending with. Home base for the e-commerce titan is Latin America, which has been hit especially hard by the pandemic. High rates of inflation and high unemployment are plaguing some countries, including the largest economy in South America: Brazil. In fact, Brazil actually slipped back into a mild recession in December. That clouds MercadoLibre's prospects a bit for 2022.
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Source Fool.com
