Brazilian stocks slip as the US-Iran deal sinks oil prices and hits Petrobras
Key takeaways
- The Ibovespa, the benchmark index of Latin America's main exchange, ended the session at 170,415 points.
- That decline hit Petrobras, Brazil's largest company, whose preferred shares, among the most traded of the day, plunged 5.1% and dragged the index down, even though the exchange initially traded in positive territory.
- The shares that lost the most value were those of the private oil firms Prio (-6.9%) and Petroreconcavo (-6.5%), also affected by the fall in crude.
Why this matters: an international story with cross-border implications worth tracking.
S o Paulo's stock exchange closed on Monday down 0.42%, dragged by the plunge of the state oil company Petrobras after the international crude price fell, linked to the preliminary agreement between the United States and Iran. The Ibovespa, the benchmark index of Latin America's main exchange, ended the session at 170,415 points.
The announcement of the pact between Washington and Tehran —which, after nearly four months of war, provides for suspending hostilities and reopening the Strait of Hormuz to navigation, through which about a quarter of the world's oil and gas production flows— caused a 4.8% drop in the international price per barrel. That decline hit Petrobras, Brazil's largest company, whose preferred shares, among the most traded of the day, plunged 5.1% and dragged the index down, even though the exchange initially traded in positive territory.
The shares that lost the most value were those of the private oil firms Prio (-6.9%) and Petroreconcavo (-6.5%), also affected by the fall in crude. In the opposite direction, the stocks that gained the most were those of the supermarket chain P o de A car (+13.5%) and the aircraft manufacturer Embraer (+7%).