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Most Brazilian Stocks Advance as OGX Outweighs Consumer Decline

Most Brazilian stocks rose as oil company OGX Petroleo e Gas Participacoes SA led an advance among commodity producers and airline Gol Linhas Aereas Inteligentes SA surged after reporting that a measure of sales increased.

Steelmaker Usinas Siderurgicas de Minas Gerais SA advanced to a one-week high as the MSCI Brazil/Materials index jumped the most among 10 industry groups. Homebuilder Gafisa SA led declines among companies that rely on domestic demand after Brazilian economists cut their 2013 growth forecasts for a sixth straight week.

The Bovespa index fell less than 0.1 percent to 60.959,79 at the close in Sao Paulo. Thirty-five stocks advanced while 29 fell. The real strengthened 1.5 percent to 2.0491 per dollar after the central bank sold currency swaps to shore it up.

The Standard & Poor’s GSCI index of 24 raw materials rose 1.3 percent as President Barack Obama and lawmakers prepared to reconvene tomorrow for talks to avert spending cuts and tax increases that threaten to spark a slowdown in the U.S. economy.

“If we see signs that things are improving around the world, especially in the U.S., the Brazilian economy would benefit,” Clodoir Vieira, an economist at Sao Paulo-based brokerage Souza Barros Corretora, said in a phone interview. “It won’t be good for anyone if the U.S. falls off the fiscal cliff, so some solution will probably come up in time. That’s what shares are pricing in.”

OGX, billionaire Eike Batista’s oil company, gained 3.1 percent to 4.38 reais. Usiminas rose 1.7 percent to 12.88 reais.

Gol Surges

Gol jumped 16 percent to 13.05 reais, the steepest gain since August 2011. The airline said in a Dec. 21 regulatory filing that revenue generated per seat flown increased 17 percent in November from a year earlier. The company also said it’s considering an initial public offering of its frequent-flier unit.

“Gol might be starting a turnaround process,” Banco Itau BBA SA’s analysts Renata Faber and Thais Cascello wrote in a note to clients dated Dec. 21. “At this point, the signs that this turnaround will be successful are clearer than they were in the past.”

Gafisa tumbled 4.9 percent to 4.49 reais, a two-month low. Online retailer B2W Cia Global do Varejo slid 1.2 percent to 16.74 reais.

Brazil’s economy will expand 3.3 percent in 2013, according to the median forecast in a Dec. 21 central bank survey of about 100 economists published Dec. 24. Analysts had forecast expansion of 3.4 percent a week earlier.

Cia. Energetica de Minas Gerais, the electricity utility known as Cemig that serves the state of Minas Gerais, dropped 5.9 percent to 22.19 reais after a deadline to receive a dividend from the company expired.

Bovespa Valuation

The Bovespa has climbed 16 percent from this year’s low in June as stimulus from central banks around the world eased concern over an economic slowdown while record low benchmark lending rates have pushed some investors to move into stocks from fixed income. The measure is up 7.4 percent in 2012.

Brazil’s benchmark equity index trades at 11.6 times analysts’ earnings estimates for the next four quarters, compared with 11 for MSCI Inc.’s measure of 21 developing nations’ equities, data compiled by Bloomberg show.

Trading volume was 4.76 billion reais in stocks in Sao Paulo today, data compiled by Bloomberg show. That compares with a daily average of 7.28 billion reais this year through Dec. 21, according to data compiled by the exchange.

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