Aug. 23 (Bloomberg) -- Cia. Hering, Brazil’s second-biggest clothing chain, led retailers higher as a gain in the real after the announcement of an intervention program spurred speculation that inflation won’t run out of control.
The shares climbed 5.3 percent to 31.90 reais at the close of trading in Sao Paulo, the steepest advance since April 23. The rally was the biggest on the MSCI Brazil/Consumer Discretionary Index, which rose 6.3 percent, the most among 10 industry groups.
“It’s good news for retailers if the currency strengthens a bit,” Sandro Fernandes, a trader at brokerage firm Geraldo Correa, said by phone from Belo Horizonte, Brazil. “Investors were concerned because we already saw prices of some products increasing as the real weakened this year. The government intervention in the currency market fuels hope that policy makers won’t have to raise interest rates too much.”
The real surged 3.7 percent to 2.3490 per dollar at 5:39 p.m. local time after the central bank stepped up efforts to stem the worst three-month decline among 31 major currencies tracked by Bloomberg, announcing a $60 billion intervention program involving foreign-exchange swaps and loans.
--Editors: Dennis Fitzgerald, Bradley Keoun