Brazil's stocks, real fall on US growth concerns

Thu Feb 14, 2008 3:31pm EST
(Updates to close)
SAO PAULO, Feb 14 (Reuters) - Brazil's stocks and currency fell on Thursday, as investors sold off emerging market securities after U.S. Federal Reserve Chairman Ben Bernanke warned of sluggish growth in coming months.
The Bovespa index .BVSP of the Sao Paulo Stock Exchange fell 1.23 percent to 61,818.99 points after four days of gains that had pushed the index 6.1 percent higher. Blue-chip stocks such as state-controlled Petrobras and private-sector bank Itau that had gained in recent days led declines.
Brazil's currency, the real BRBY, weakened 0.4 percent to 1.751 per U.S. dollar.
Bernanke also said he sees investment banks taking more write-downs on losses from subprime mortgages, which may dampen further demand for riskier emerging market securities and reduce capital flows to Brazil and other developing nations.
"He (Bernanke) is preparing the markets for results that won't be so good, but that doesn't mean the U.S. banking system will go broke," said Marcos Forgione, an analyst at the Hencorp Commcor brokerage.
Interest-rate futures <0#dij:> on the BM&F commodities and futures exchange in Sao Paulo edged higher, tracking the downturn in local market sentiment.
On the stock market, state-controlled oil company Petrobras (PETR4.SA: Quote, Profile, Research), the heaviest weighted stock on the Bovespa index, fell 1.22 percent to 83.53 reais even as crude prices in international markets gained.
Itau (ITAU4.SA: Quote, Profile, Research), Brazil's second-largest private sector bank, fell 3.75 percent to 40.08 reais. The stock had jumped 14.2 percent over the previous three sessions.
Unibanco (UBBR11.SA: Quote, Profile, Research), one of Brazil's largest private-sector banks, edged up 0.18 percent to 22.39 reais. The bank said on Thursday that fourth-quarter net profit surged 44 percent to 827 million reais due to the sale of local market assets and an increase in its loan portfolio.
(Reporting by Elzio Barreto and Fabio Gehrke)