The Ibovespa fell for the third time in four sessions as raw-material producers including mining company Vale SA followed a drop in commodities, outweighing a rally by wireless carrier Tim Participacoes SA. (TIMP3)
Restoque Comercio e Confeccoes de Roupas SA, the apparel maker that owns the clothing retailer Le Lis Blanc, sank after JPMorgan Chase & Co. cut its recommendation to the equivalent of sell. Paper maker Klabin SA fell the most on the MSCI Brazil/Materials Index.
The Ibovespa retreated 0.8 percent to 54,181.90 at 11:02 a.m. in Sao Paulo, with 54 stocks lower and 16 higher. The gauge is up 14 percent since the end of June, poised for its biggest quarterly advance in four years. The Standard & Poor’s GSCI index of 24 raw materials slipped 0.7 percent, with crude and metals falling, amid concern that a political clash over the U.S. budget might shut down the federal government.
“The U.S. budget talks are something to be watched,” Fernando Goes, an analyst at Sao Paulo-based brokerage Clear Corretora, said in a phone interview. “That could spark some profit taking in the short term, considering that Brazilian equities have gained quite a bit recently.”
The U.S. government’s next fiscal year begins Oct. 1 and some services may be suspended unless Congress agrees on a spending bill by then. The debt ceiling could be reached some time after the middle of next month, according to the Treasury Department.
Vale fell 0.9 percent to 32.46 reais. Klabin lost 2.3 percent to 11.74 reais. Tim jumped 6.3 percent to 10.75 reais after Madrid-based Telefonica SA (TEF) agreed to boost its stake in parent Telecom Italia SpA. (TIT)
The real weakened 0.4 percent to 2.2080 per dollar.
To contact the reporter on this story: Ney Hayashi in Sao Paulo at email@example.com
To contact the editor responsible for this story: David Papadopoulos at firstname.lastname@example.org