Bovespa Futures Gain as Brazilian Retail Sales Exceed Forecasts

Bovespa futures advanced, signaling the stock gauge may rise a second day, after a report that showed retail sales increased more than forecast in December spurred optimism Brazil will withstand the global slowdown.

Petroleo Brasileiro SA (PETR4) may move after Chief Executive Officer Maria das Gracas Foster said the oil company is at an “advanced” stage with plans for asset sales. Tobacco company Souza Cruz SA (CRUZ3) may be active after saying 2011 net profit rose 11 percent to 1.6 billion reais ($932 million).

Bovespa futures added 0.3 percent to 65,935 at 10:36 a.m. in Sao Paulo. The real was little changed at 1.7165 per U.S. dollar.

Brazil’s retail sales rose 0.3 percent in December from November, the national statistics agency said today in Rio de Janeiro. The median estimate from 44 analysts surveyed by Bloomberg was for an increase of 0.1 percent. Sales rose 6.7 percent from a year earlier.

“The retail data showed domestic consumption should remain strong this year, sustaining Brazil’s growth even amid a global economic slowdown,” Luciano Rostagno, chief strategist at Banco WestLB do Brasil, said by phone from Sao Paulo. “Positive news coming from Europe also helps boost demand for riskier assets.”

Brazil’s benchmark equity gauge jumped the most in eight weeks yesterday after Greek lawmakers approved measures needed to gain access to bailout funds. Italian 10-year bonds advanced today after Italy’s borrowing costs fell at sale of 6 billion euros ($7.9 billion) of bonds.

Relative Value

The Bovespa has advanced 16 percent this year, following an 18 percent slump in 2011, buoyed by Brazil’s interest-rate cuts, signs of growth in the U.S. and renewed optimism Europe may be closer to solving its debt crisis. The gauge trades at 10.3 times analysts’ earnings estimates, which compares with a ratio of 10.5 for MSCI Inc.’s measure of 21 developing nations’ equities, weekly data compiled by Bloomberg show.

Traders moved 7.07 billion reais in stocks in Sao Paulo yesterday, data compiled by Bloomberg show. That compares with a daily average of 6.59 billion reais this year through Feb. 7, according to data from the exchange.

To contact the reporter on this story: Ney Hayashi in Sao Paulo at ncruz4@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos in New York at papadopoulos@bloomberg.net

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