Brazil's stocks fall on U.S. economy, real slips

Thu Jul 31, 2008 12:40pm EDT
SAO PAULO, July 31 (Reuters) - Brazil's stock market fell on Thursday as a fall in crude prices pushed state-controlled oil company Petrobras lower, while unexpectedly weak U.S. growth data weighed on miner Vale and local steelmakers.
The Bovespa index .BVSP of the Sao Paulo stock exchange fell 1 percent to 59,382 after a two-day winning streak that pushed it 5.5 percent higher.
Data showing the U.S. economy grew less than expected in the second quarter and a jump in weekly jobless claims signaling weakness in the labor market helped push the Dow Jones industrial average .DJI lower and dragged on Brazilian markets too.
"The Bovespa is tracking Wall Street because of the negative economic figures in the United States," said Alessandra Ribeiro, an analyst at Tendencias consultancy in Sao Paulo.
Petrobras (PETR4.SA: Quote, Profile, Research, Stock Buzz) fell 1.1 percent to 36.09 reais per share, tracking a fall of more than $2 a barrel in crude prices on concerns over lower demand because of a U.S. slowdown.
Vale (VALE5.SA: Quote, Profile, Research, Stock Buzz) dropped 1.5 percent to 40.98 reais as investors took profits after the stock rallied about 9.5 percent over a three-day period.
Brazilian steelmakers also fell on concerns that a slower U.S. economy will cut metals demand. CSN (CSNA3.SA: Quote, Profile, Research, Stock Buzz) declined 2.8 percent to 61.63 reais, while Usiminas (USIM5.SA: Quote, Profile, Research, Stock Buzz) was down 1.8 percent to 69.54 reais.
JBS SA (JBSS3.SA: Quote, Profile, Research, Stock Buzz), the world's largest beef producer, sank 4.4 percent to 8.17 reais after the company reported a second-quarter net loss of 364.4 million reais, compared with profits of 38.7 million reais in the year-earlier period.
Cosan (CSAN3.SA: Quote, Profile, Research, Stock Buzz), the world's biggest combined sugar and ethanol producer, fell 1.4 percent to 30.80 reais. The company reported late on Wednesday it posted a 5.3 million reais net loss in the fiscal fourth-quarter, compared with profit of 164.7 million reais in the same period of 2007.
Brazil's currency, the real BRBY, weakened 0.32 percent to 1.567 per dollar, tracking the decline in the U.S. and Brazilian equity markets.
Interest rate futures <0#dij:> on the BM&F commodities and futures exchange in Sao Paulo were mostly higher after the central bank released minutes of last week's rate-setting meeting, which said a "vigorous" monetary policy may be needed to head off a steady increase in inflation expectations. (Reporting by Elzio Barreto and Aluisio Alves; Editing by James Dalgleish)