Iron-ore producer Vale SA and planemaker Embraer SA led gains among Brazilian exporters on wagers they’ll benefit from the drop in the currency after Standard & Poor’s cut the country’s credit rating to junk.
Vale, the world’s largest producer of the steelmaking ingredient, rose 2.6 percent to 15.76 reais at 11:01 a.m. in New York. Embraer added 2.7 percent to 23.92 reais. Pulp producer Fibria Celulose SA, which gets more than 90 percent of its revenue from exports, climbed as much as 1.9 percent.
Six of the 10 best performers on the Ibovespa were exporters as investors speculated that the weaker real will make their products more competitive overseas. Companies that have most of their revenue in reais and significant expenses in dollars, including airline Gol Linhas Aereas Inteligentes SA, were among the biggest losers as Brazil’s benchmark index sank 1.1 percent. The real tumbled 2.4 percent to a 12-year low.
“The weakening of the real, favoring exporters, compensates a little bit for the pessimism that comes from the downgrade,” Fernando Goes, an analyst at the brokerage Clear Corretora, said from Sao Paulo. “The companies that haven’t been hit by the commodity prices rout recently, especially pulp producers, are poised to gain the most from this trend.”
Suzano Papel e Celulose SA added 0.9 percent, extending its gain this year to 69 percent, the best performance on the Ibovespa. Fibria, Brazil’s biggest pulp producer, has climbed 66 percent.