PBR Petroleo Brasileiro ADR

By Jeffrey T. Lewis

SAO PAULO--The Brazilian real weakened against the dollar on Tuesday and shares fell, as the country's turbulent political situation got even more complicated.

The Ibovespa stock index fell 4% to 47362 points, its biggest drop so far this year. The real exited active trading at 3.8744 to the dollar, according to Tullett Prebon via FactSet, after closing at 3.7540 on Friday. Monday was a holiday in Brazil and financial markets were closed.

The struggle between Brazilian President Dilma Rousseff and the country's Congress reached a new level on Tuesday. The country's Supreme Court ruled against a reported attempt by the head of the lower house of the legislature to ease the path to impeaching Ms. Rousseff.

The lower house leader, Eduardo Cunha, on Tuesday was also the subject of an ethics complaint, which seeks to remove him from office amid allegations that he received money from a graft ring linked to the state-controlled oil company Petroleo Brasileiro SA currently under investigation by Brazilian authorities. Mr. Cunha denies the allegations.

Petrobras, as the state oil company is known, was among the biggest decliners in the Ibovespa on Tuesday, giving up 7.6% to close at 8.13 reais.

Disappointing trade data out of China, Brazil's biggest trade partner, also weighed on stocks. Shares of Companhia Siderurgica Nacional, which exports steel and iron ore, fell 12.6% to 4.66 reais and iron miner Vale SA declined 7.9% to 14.98 reais.

Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com

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(END) Dow Jones Newswires

October 13, 2015 17:46 ET (21:46 GMT)

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