Portugal PM to Meet President Monday on Resignation

LISBON (Reuters) - Portuguese Prime Minister Antonio Guterres will offer his resignation to President Jorge Sampaio Monday afternoon, a presidential spokesman told Reuters.

Guterres' Socialist Party suffered a sweeping defeat on Sunday at the hands of the opposition Social Democrats in local elections.

Guterres said early Monday that he would offer to resign. His resignation would set the stage for early elections in Portugal, one of the European Union (news - web sites)'s poorest countries.

VENEZUELA SEEN WEAKER

Venezuela, where President Hugo Chavez threatened over the weekend to nationalize some of the nation's banks, is set to underperform the rest of the market this week.

``There is more downside risk in Venezuela,'' Suki said.

Chavez threatened on Saturday to nationalize banks that resisted his leftist reforms and warned opponents that his revolutionary movement would be defeated only over his dead body.

Venezuela DCB bonds, which closed Friday at a bid will 75.50, will trade lower based on rising political risk, according to Gerhard Herrera, emerging markets debt strategist at IDEAglobal, a Wall Street economic research firm.

``It is clear that he has lost control and placed himself in a totalitarian position along the lines of like Fidel Castro (the Communist leader of Cuba). I would not rule out widespread social uprisings before the end of the first quarter next year,'' Herrera said.

In a speech in the National Assembly that marked a toughening of Chavez's response to bitter domestic criticism, the former paratrooper said he would not change any aspect of recent leftist legislation that has caused an outcry in the private sector of the world's No. 4 oil exporter.

``Chavez is in a difficult position. He cannot back off from what he has said. Then again he does not have the support to do what he is saying he will do,'' Herrera said.

``I think it's just a question of time. Sooner or later he will have to step down,'' he added. ``My guess is he will go down quietly, not because he wants to but because he has no other option.''