The Bovespa index declined from a one-week high as oil company OGX Petroleo & Gas Participacoes SA followed crude lower and iron-ore producer Vale SA dropped amid concern global growth is faltering.
Steelmaker Cia. Siderurgica Nacional SA tumbled as the MSCI Brazil/Materials index fell to the lowest this month amid concern slower growth in Brazil’s trading partners will curb demand for commodities exports. BRF Brasil Foods SA, the world’s biggest poultry exporter, fell the most in six months after Valor Economico reported a conflict among shareholders over a board appointment.
The Bovespa declined 0.6 percent to 61,727.61 at the close of trading in Sao Paulo. The real fell 0.2 percent to 2.0358 per U.S. dollar. The Standard & Poor’s GSCI index of 24 raw materials slid 0.5 percent as economic growth in Germany slowed to 0.7 percent last year, while economists had forecast expansion of 0.8 percent. Manufacturing in the New York region contracted in January for the sixth straight month.
“When you look at fundamentals, when you look at how the economies are doing around the world, what you see is very slow growth,” Rogerio Freitas, a partner at Rio de Janeiro-based hedge fund Teorica Investimentos, said in a phone interview. “It’s not a scenario that supports equities.”
OGX fell 3 percent to 5.20 reais as oil slipped from the highest level in almost four months. Vale slid 0.3 percent to 39.65 reais. CSN, as Siderurgica Nacional is also known, dropped 1.8 percent to 12.47 reais.
Homebuilders Gafisa SA and Brookfield Incorporacoes SA gained the most on the Bovespa after both reported preliminary figures that signaled sales increased in the fourth quarter. Smaller competitor Even Construtora e Incorporadora SA also climbed.
Gafisa jumped 6.1 percent to 5.20 reais after saying contracted sales almost tripled from a year earlier to 905.2 million reais in the three months ending in December. Brookfield rose 5.5 percent to 3.86 reais after saying that new projects announced during the fourth quarter totaled 1.76 billion reais, three times the 577 million reais in the previous quarter.
Even added 0.6 percent to 9.45 reais after reporting fourth-quarter sales rose 23 percent from the previous quarter to 505 million reais.
“Operational numbers released yesterday should be welcomed by the market,” Credit Suisse Group AG analysts including Guilherme Rocha, wrote in a note to clients commenting on the results from all three homebuilders.
Brasil Foods Tumbles
Brasil Foods sank 3 percent to 43.84 reais. The pension fund for Petroleo Brasilero’s workers doesn’t support the appointment of Brazilian billionaire Abilio Diniz to the board, while stockholders Tarpon Investimentos SA and Previ, the retirement fund for Banco do Brasil SA’s employees, back the move, Sao Paulo-based newspaper Valor Economico reported today without saying where it got the information.
Brasil Foods said in an e-mailed statement that it woudn’t comment on Valor’s report.
The Bovespa entered a bull market on Jan. 3 after rising 21 percent from last year’s low on June 5 as stimulus from central banks around the world eased concern that economic growth might miss expectations while borrowing costs at a record low in Brazil boosted equity demand. The index has since pared its gain to 18 percent.
Brazil’s benchmark equity gauge trades at 11.2 times analysts’ earnings estimates for the next four quarters, compared with 10.9 for MSCI’s measure of 21 developing nations’ equities, data compiled by Bloomberg show.
Trading volume was 6.8 billion reais in stocks in Sao Paulo today, according to data compiled by Bloomberg. That compares with a daily average of 7.25 billion reais in 2012, according to data compiled by the exchange.