Most Brazilian stocks rose as Cia. Hering led consumer companies higher after a report eased concern that inflation will hurt Brazil’s recovery, outweighing losses by OGX Petroleo e Gas Participacoes SA.
Rossi Residencial SA was the best performer among homebuilders. Cia. de Bebidas das Americas, the Brazilian unit of Anheuser-Busch InBev NV, rebounded from a five-week low. Oil company OGX plunged amid discussions with Petroliam Nasional Bhd. over the sale of oil blocks and after saying controlling shareholder Eike Batista sold shares yesterday and plans to sell more in the future.
The Ibovespa added 0.1 percent to 49,921.88 at the close of trading in Sao Paulo, with 47 of 71 stocks advancing. The real fell 0.8 percent to 2.3649 per dollar at 5:28 p.m. local time, extending its three-month drop to 11 percent. The IGP-M index of wholesale, construction and consumer prices rose 0.15 percent in the month through Aug. 20 after a previous reading of 0.26 percent, the Getulio Vargas Foundation reported.
“Investors overreacted a little bit to the currency drop, making some stocks cheap,” Joao Pedro Brugger, a portfolio manager at Leme Investimentos, said in a phone interview from Florianopolis, Brazil. “With the real depreciating, people became more concerned about the outlook for inflation and interest rates. These risks exist, but I don’t think it will have such a big impact on companies like homebuilders, which have suffered a lot lately.”
Rossi climbed 3.7 percent to 2.79 reais, paring losses in the past three months to 26 percent. Hering rose 3 percent to 31.31 reais. AmBev, as Cia. de Bebidas is also known, jumped 3 percent to 82.90 reais.
Brazil’s central bank increased its target lending rate yesterday by a half-percentage point for a third straight meeting, setting it at 9 percent. The statement accompanying the decision said the move will help “put inflation on a decline and assure that this trend will persist next year.”
Banco do Brasil SA, Latin America’s biggest bank by assets, rose 2.2 percent to 22.59 reais after it was rated the equivalent of buy in new coverage at JPMorgan Chase & Co.
OGX, the most-active stock by volume in Sao Paulo today, sank 12 percent to 50 centavos. Shares have dropped 38 percent in three days, erasing gains in the six weeks ended Aug. 26. OGX said yesterday Petronas has no right to delay buying stakes in two Brazilian oil blocks for $850 million after the Malaysian oil producer’s Chief Executive Officer Shamsul Azhar Abbas said Aug. 26 that the deal hinges on OGX’s undertaking a debt restructuring.
Batista sold 49.8 million shares yesterday, or 1.54 percent of the total outstanding, according to a regulatory filing from OGX today. The former billionaire still plans to sell at least five percent of his holdings while keeping a controlling stake, OGX said without citing a time-frame for the sale.
The Ibovespa has rallied 11 percent from this year’s low on July 3 as higher commodities prices and a weaker real fueled a rally in raw-material exporters. Brazil’s benchmark gauge climbed 6.4 percent in dollar terms during the period, compared with an advance of 0.9 percent for the MSCI Emerging Markets Index of 21 developing nations’ equities.
Trading volume of stocks in Sao Paulo was 6.16 billion reais today, according to data compiled by Bloomberg. That compares with a daily average of 7.75 billion reais this year through Aug. 27, according to data compiled by the exchange.