The 71-billion-rand loss in 1 day of Vale is the largest in the history of the Brazilian market | Economy

Up to Monday, the largest decline in market value in a day had been recorded by Petrobras, who had lost in May 2018 more than R $ 47 billion. At that time, oil investors reacted to the conduct of the truck drivers' strike and its reflections on the company's pricing policy.

Vale's largest one-day market price decline prior to the second trading session was recorded on October 15, 2008, when the company suffered a loss of $ 27.4 billion, still in agreement. with Economatica.

During the second trading session, the market reacted in the first session after the break-up of the dam of the Vale no Córrego

bean mining company.

The company announced Monday that its board of directors had decided to suspend the payment of dividends and interest on own funds and variable compensation (bonus).

Since the incident, 4 court decisions have already blocked Vale 's resources for 11.8 billion rubles, in addition to fines of a total of 350 million pesos.

Several banks and foreign financial institutions have already cut their recommendations on the company's badets, including Jefferies, HSBC, BMO and Macquarie, among others, says Valor Online.

Risk management agencies also reviewed the minor's note after the incident. S & P has put the credit rating of the company and its subsidiaries for accounting late Friday (25). On Monday, Fitch lowered Vale's credit rating from BBB + to BBB-. The company's ratings have also been put in the spotlight for possible relegation.

For the chief economist of Novo Futura Investimentos, Pedro Paulo Silveira, the incident raises two main doubts among investors. "One, in the short term, concerns the cost of this new tragedy for shareholders.Another, in the long run, leads us to the risk of further collapses in other dams", a- he said in a statement. "Even if short-term problems are solved with a hiccup of 5% to 10% of stock prices, long-term issues are not easily quantifiable."