Ibovespa Futures Decline as Metals Fall on U.S. Stimulus Outlook

Ibovespa futures dropped, after the benchmark equity gauge fell for a second straight session yesterday, as lower metal prices dimmed the outlook for Brazil’s raw-material producers.

Cia. de Bebidas das Americas, Latin America’s largest brewer, may move after reporting third-quarter earnings that were less than analysts forecast. Usinas Siderurgicas de Minas Gerais SA may be active after HSBC Holdings Plc raised its recommendation on the steelmaker to the equivalent of buy.

Ibovespa futures contracts expiring in December rose 0.5 percent to 53,860 at 9:19 a.m. in Sao Paulo. The equity index is up 3.2 percent this month. The real slid 0.3 percent to 2.1974 per dollar today. The Bloomberg Base Metals 3-Month Price declined 0.5 percent on speculation the Federal Reserve will start to slow U.S. economic stimulus sooner than forecast.

“Brazilian stocks will probably follow the worsening in the external outlook and fall,” Banco Bradesco SA’s economic team wrote in a note to clients, citing a “negative” market reaction from a statement yesterday when the Fed said the U.S. economy is showing signs of strength.

OGX Petroleo e Gas Participacoes SA, the oil company owned by former billionaire Eike Batista, will be removed from the Ibovespa stock benchmark today after it filed for bankruptcy protection, BM&FBovespa said in a statement. While the stock will continue to trade in Sao Paulo, it will be cut from the gauge after markets close. The Ibovespa will be rebalanced after OGX’s removal.

Brazil’s main equity index entered a bull market Sept. 9 after rising 20 percent from this year’s low on July 3 through that day. The gauge is still down 17 percent in dollar terms this year, compared with a decline of 1.8 percent for the MSCI Emerging Markets Index of 21 developing nations’ equities.

Trading volume of stocks in Sao Paulo was 6.87 billion reais yesterday, compared with a daily average of 7.61 billion reais this year through Oct. 22, according to the latest data available from the exchange.

To contact the reporter on this story: Ney Hayashi in Sao Paulo at ncruz4@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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