OGX Rises Most in World Before Index Changes
(Corrects date in third paragraph.)
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 6.4 percent to 2.3 reais at 12:10 p.m. in Sao Paulo. A 52 percent four-day surge is the steepest among global stocks tracked by Bloomberg with a value of at least $3 billion. OGX shares reduced a year-to-date loss to 49 percent.
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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