TUESDAY, MAY 27, 2014
SAO PAULO–Brazilian shares closed lower Tuesday, with electric companies among the biggest decliners, and the real weakened against the dollar.
The benchmark Ibovespa stocks index fell 1.4% to 52152 points. The real exited active trading at 2.2409 to the dollar, according to Tullett Prebon via FactSet, after closing at 2.2227 on Monday.
Brazilian power-utility shares have been buffeted in recent months by a drought that started in January and has dried up the reservoirs behind many hydroelectric plants.
Copel, a power company based in Brazil’s Parana state, was the biggest decliner in the Ibovespa, falling 4.7% to 32.70 reais, and Cemig, based in Minas Gerais state, was the third-biggest decliner with a drop of 4% to 16.18. Sao Paulo, Minas Gerais and Parana states were the worst hit by the drought. Sao Paulo power company CESP’s shares fell 3.4% to 27.35 reais.
Meat-packer JBS was the second-biggest decliner in the index. Pilgrim’s Pride Corp., the U.S. meat company controlled by JBS, announced Tuesday a $5.5 billion offer to buy Hillshire Brands. JBS shares fell 4.2% to 7.56 reais.
Other Brazilian blue-chips closed mostly lower. Iron miner Vale declined 0.9% to 26.66 reais, and state-controlled oil company Petrobras gave up 2.1% to 17.49 reais.