Brazil-Swine flu hits value of meat shares.

BRAZIL-SWINE FEVER ROCKS SHARE MARKET IN MEAT AND AGRICULTURE.

Brazilian stocks dropped for the first time in four days, led by airlines and food producers, on concern the outbreak of swine flu will reduce demand for travel and the country’s exports.

Tam SA, Brazil ’s largest airline, sank 4.4 percent on speculation people will curtail travel as the disease spreads. JBS SA fell the most in four months amid concern consumers will avoid eating pork. Cia. Vale do Rio Doce, the world’s biggest iron ore miner, slid the most this month as metals tumbled.

The flu outbreak "has direct effects for some companies" such as airlines and pork producers, said Julio Martins, who oversees about $123 million at Banco Prosper in Rio de Janeiro . "The market has risen so quickly the past few weeks that people are quick to sell."

The Bovespa fell 387.48, or 0.8 percent, to 46,384.31 at 10:04 a.m. New York time. The index has climbed for seven straight weeks, the longest streak since January 2006.

Speculation that the swine flu’s outbreak may hinder government efforts to revive economic growth halted a seven-week rally in emerging-market stocks and dragged down commodity prices. Mexico ’s peso sank to the lowest level in almost three weeks against the dollar, and the Bolsa index fell 3.6 percent on concern the outbreak will deepen the country’s economic slump. The flu was first discovered in Mexico last week.

Tam shares declined 72 centavos to 15.78 reais. Gol Linhas Aereas Inteligentes SA, Brazil ’s second-largest airline, retreated 2.1 percent to 7.43 reais.

Commodities Drop

Grain, metals and crude oil prices dropped as the virus spread. Brazil ’s biggest exports are iron ore products, oil, soybeans, and beef and poultry, according to the trade ministry’s Web site.

JBS, the world’s biggest beef producer, fell 6.5 percent to 6.50 reais and earlier lost 10 percent for the biggest intraday decline since December.

"Fourteen percent of JBS revenue comes from pork in the U.S. ," said Denise Messer, analyst at Brascan Corretora in Rio de Janeiro . "The fear is that because the disease hit Mexico it could hit the U.S. "

Vale fell 1.7 percent to 30.03 reais. The Bloomberg Base Metals 3-Month Price Commodity Index dropped 3.4 percent on speculation the flu outbreak may hurt efforts to revive the world economy.

Petrobras Falls

Petroleo Brasileiro SA, Brazil ’s state-controlled oil company, lost 1.3 percent to 28.93 reais. Crude oil for June delivery declined as much as 6.9 percent in New York .

Barack Obama’s administration declared swine flu, normally spread among pigs, a public health emergency in the U.S. after 20 people contracted the disease. Swine flu is a respiratory disease of pigs caused by type-A influenza that regularly leads to outbreaks among the animals, according to the U.S. Centers for Disease Control and Prevention.

The Bovespa pared its gain this year to 23 percent. The measure has rallied 57 percent from an Oct. 27 low on speculation government measures, falling interest rates and a recovery in commodity prices will boost growth.