The Ibovespa fell, led by a plunge in billionaire Eike Batista’s OGX Petroleo & Gas Participacoes SA, as economists cut estimates for Brazil’s growth.
OGX fell to an unprecedented low after saying it may shut its only producing wells next year. Mining company MMX Mineracao & Metalicos SA and port developer LLX Logistica SA, also controlled by Batista, dropped. PDG Realty SA Empreendimentos & Participacoes led losses by real estate companies after a central bank survey showed analysts cut expansion forecasts a seventh straight week.
The Ibovespa retreated 0.5 percent to 47,229.59 at the close of trading in Sao Paulo. Thirty-one stocks declined on the measure while 39 rose. The real gained 0.1 percent to 2.2290 per U.S. dollar.
“It’s hard to see equities rebounding when there’s this perception that Brazil is not going anywhere in terms of growth,” Alexandre Ghirghi, a portfolio manager at Metodo Investimentos, said by phone from Sao Paulo. “There’s also all this noise around Eike’s companies, which have a big weighting on the index.”
Economists covering Brazil lowered their median estimate for 2013 growth to 2.40 percent from 2.46 percent, according to a survey released today. The survey also showed that the central bank is expected to lift the benchmark lending rate to 9.25 percent this year, up from a previous forecast of 9 percent.
PDG Realty sank 3.8 percent to 2.03 reais. Competitor Rossi Residencial SA lost 2.7 percent to 2.84 reais. The BM&FBovespa Real Estate Index of 20 companies extended this year’s slump to 23 percent.
OGX plunged 29 percent to 56 centavos. The stock has fallen 90 percent in the past year. The Rio de Janeiro-producer told its shipbuilding sister company OSX Brasil SA that wells at the Tubarao Azul field may suspend output in 2014, according to an OSX regulatory filing.
OSX dropped 5 percent to 1.33 reais. LLX retreated 10 percent to 89 centavos, while MMX slipped 9.5 percent to 1.33 reais.
Losses on the gauge were limited as Gerdau SA, Latin America’s largest steelmaker, rose 5.1 percent to 13.25 reais as commodities prices rose and after Bank of America Corp. raised its recommendation on the stock to buy.
“International steel prices are close to a bottom, while results should rebound consistently after a weak first quarter,” Bank of America’s analysts including Thiago Lofiego wrote in a research note.
The Standard & Poor’s GSCI index of 24 raw materials added 0.8 percent after a report showed manufacturing rebounded in the U.S., the world’s biggest metals consumer after China.
Fibria Celulose SA, the world’s largest pulp producer, jumped 4.5 percent to 25.86 reais, extending a two-day advance to 9 percent, the most for such period since Sept. 2012.
The Ibovespa slumped into a bear market on June 11 after falling more than 20 percent from this year’s peak on Jan. 3. It has since extended those losses to 25 percent. Brazil’s benchmark equity gauge trades at 12.1 times analysts’ earnings estimates for the next four quarters, compared with 10.3 for the MSCI Emerging Markets Index of 21 developing nations’ equities.
Trading volume for stocks in Sao Paulo was 6 billion reais today, according to data compiled by Bloomberg. That compares with a daily average of 7.93 billion reais this year through June 25, according to data from the exchange.