We’re not sure if they’re throwing around “Ibovespa 100K” hats on the floor of the Sao Paulo stock exchange, but Brazil’s benchmark Ibovespa equity index just topped the 100,000 level for the first time in its history.  The latest breakout in Brazilian stocks comes after a two-month period of sideways trading that followed a gain of over 40% from the lows last Summer.

The rally in Brazilian stocks and the new high in the Ibovespa are impressive, but at the same time a bit misleading.  Brazilian equities may be at record highs, but for a US investor invested in Brazil, things don’t look nearly as impressive.  The chart below shows the Ibovespa index going back to 2006 priced in US dollars.  From the perspective of a US investor, Brazilian stocks are still up over 40% from their lows last Summer, but even after that move they are still down 41% from their highs way back in May 2008.

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