May 1 (Bloomberg) -- Brazilian stocks trading in the U.S. rose to the highest in seven months, led by Cia. Vale do Rio Doce and Petroleo Brasileiro SA, as commodity prices rallied on the prospect the global recession will end later this year.

Petrobras, Brazil’s state-controlled oil producer, surged to the highest in two weeks as JPMorgan Chase & Co. and Barclays Capital Inc. said the U.S. economy may begin growing again in the second half of 2009. Iron ore miner Vale jumped to the highest in almost three months after the Baltic Dry Index rose 1.1 percent. Itau Unibanco Banco Multiplo SA rose after Credit Suisse Group AG said Brazilian bank earnings will show resilience in the first quarter amid the economic slowdown.

The Bank of New York Mellon Brazil ADR index climbed 4.2 percent to 300.78 in New York, the highest since October 14. Latin American markets were closed today for a national holiday. The Bovespa had its best month in four years in April as central banks cut interest rates and commodities gained on speculation of rising demand from China.

“There is this notion that China will lead the world out of recession,” said James O’Leary, portfolio manager for the Touchstone International Growth Fund, part of Reno, Nevada-based Navellier & Associates, which manages $3 billion. “If that’s the case, they need to be consuming more commodities.”

China manufacturing expanded for a second month in April as government stimulus spending stoked a fledgling recovery in the world’s third-biggest economy.

The American depositary receipts of Petrobras surged 4.3 percent to $35.92 in New York Stock Exchange composite trading.

The company announced yesterday it has started commercial oil production at the Tupi field in the Santos Basin off Brazil. Petrobras’s offshore Tupi field discovery is the largest since Mexico’s Cantarell find in 1976.

‘Good News’

“It’s good news Petrobras is finally shipping oil,” said O’Leary, whose funds own both Vale and Petrobras. “Tupi shows Petrobras believes there will be demand for oil in the future.”

Crude futures rose 4.1 percent to $53.20 on improved prospects for the world’s biggest economy. JPMorgan projects the U.S. will grow at a 1 percent rate in the last half of 2009, while Barclays forecasts an expansion of 1 percent in the third quarter and 2 percent in the last three months of the year.

Vale climbed 5.5 percent to $17.42. The Baltic Dry Index, a gauge of world trade, gained for a second day on speculation rising steel prices will spur demand for iron ore to produce the metal.

Itau gained 2.4 percent to $14.06. Credit Suisse said in a note it prefers Itau among all Brazilian banks and expects Latin America’s largest bank and rival Banco Bradesco SA to report “flat” earnings in the first quarter from the previous quarter.

To contact the reporter on this story: Allen Wan in New York at awan3@bloomberg.net

Last Updated: May 1, 2009 16:38 EDT