April 30 (Bloomberg) -- Billionaire Eike Batista’s OGX Petroleo e Gas Participacoes SA, which lost as much as 90 percent in the past year, is the world’s best-performing major stock in the last four days amid prospects that its weighting in Brazil’s benchmark index will increase.
The stock rose as much as 7.4 percent to 2.33 reais today, extending a gain since April 24 to 54 percent. That’s the steepest four-day surge among stocks with a value of at least $3 billion. By 3:15 p.m. in Sao Paulo, OGX had erased today’s gain and was down 1.4 percent for a 51 percent year-to-date loss.
The oil producer’s weighting in Brazil’s Ibovespa index probably will rise to about 4.8 percent on May 6 from 2.5 percent now following a bank holiday tomorrow, according to Bloomberg calculations. Short selling reached a record 22 percent of shares available for trading yesterday as the stock plummeted in the past four months amid investor concerns over missed output targets, low production and dwindling cash.
“There’s a re-balancing of the index that can have an impact,” said Leonardo Brito, an analyst at hedge fund Teorica Investimentos, said by phone from Rio. “There could be a bit of a short squeeze, it was very oversold.”
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