Brazilian Stocks Fall, Led by Vale, Sadia, B2W; Bolsa Climbs

By Alexander Ragir

Oct. 23 (Bloomberg) -- Brazilian stocks fell for a third day, led by commodity producers and retailers, as metal prices slid and Deutsche Bank AG cut its profit estimates for merchants on the prospect of a weakening currency and slowing economy.

Cia. Vale do Rio Doce, an iron ore miner which also produces cooper, led a decline in raw-material producers as copper fell below $4,000 a metric ton for the first time since November 2005. Sadia SA sank as Raymond James & Associates said currency swings and a possible recession next year will hurt food exporters. B2W Cia. Global do Varejo, the biggest online retailer, extended its two-day decline to 20 percent as Deutsche cut profit estimates for the industry by an average 9 percent for next year.

The Bovespa index lost 4.2 percent to 33,602.24 at 9:29 a.m. New York time. The BM&FBovespa MidLarge Cap index slid 4.4 percent, while the BM&FBovespa Small Cap index slipped 3.5 percent. Mexico's Bolsa index climbed 0.2 percent. Chile's Ipsa rose 0.2 percent.

Vale fell 2.5 percent to 23.50 reais.

Copper, nickel and zinc extended declines in London on speculation the global economic slump will crimp demand for industrial, or base, metals from investors who had helped send commodity prices to a record in July. China, the world's largest iron ore consumer, said the global market will be in surplus in 2009, one year earlier than expected, as the credit crisis slows economic growth and orders from steelmakers.

Sadia dropped 4.5 percent to 4.44 reais. Brazil's second- biggest food maker was initiated at ``underperform'' in new coverage at Raymond James.

B2W fell 4.8 percent to 23.15 reais. Deutsche cut the retailer's share-price estimate to 50 reais from 70 reais. Earnings estimates for the country's retailers were cut due to ``a further slowdown and weaker currency in Brazil than previously anticipated,'' wrote Reinaldo Santana, analyst at Deutsche.

To contact the reporter on this story: Alexander Ragir in Rio de Janeiro at aragir@bloomberg.net.