Bovespa Rises as China Stimulus Bets Boost Brazil Export Outlook

The Bovespa (IBOV) index rose for a third session as Brazilian raw-material producers rallied after weaker economic data from China to the U.S. fueled bets policy makers will take further steps to boost growth.

Steelmaker Cia. Siderurgica Nacional SA had its biggest three-day gain since January 2009 and iron-ore producer Vale SA (VALE3) rose to the highest in two weeks as metals advanced. Airline Gol Linhas Aereas Inteligentes SA (GOLL4) jumped after Veja magazine said Qatar Airways Ltd. is in talks to buy the carrier.

The Bovespa rose 0.1 percent to 58,404.10 at the close of trading in Sao Paulo. The real gained 0.3 percent to 2.0227 per U.S. dollar. The Bloomberg Base Metals 3-Month Price Commodity Index climbed 1.4 percent.

“Economic data around the world have been pretty weak, and markets are seeing this as a good sign, as it increases chances for further stimulus,” Marcello Paixao, a portfolio manager at Principia Asset Management, said by phone from Sao Paulo. “Brazilian equities still have room for further gains if the U.S. or China act to boost growth.”

China’s economic expansion faces “notable downward pressure,” President Hu Jintao said Sept. 8. Factory output rose at the slowest pace in three years in August, National Bureau of Statistics figures showed yesterday. Imports into the country unexpectedly fell, the customs bureau said today.

The Federal Reserve meets this week to discuss potential asset purchases after the U.S. added fewer-than-estimated jobs last month, Labor Department figures showed on Sept. 7, when Brazilian markets were closed for a holiday.

Gol Jumps

Gol jumped 5.5 percent to 9.90 reais. Qatar Airways executives met top officials at Gol to discuss the acquisition, Veja reported, without saying where it got the information. Gol said in an e-mailed statement today it isn’t in talks with Qatar Airways.

CSN, as Cia. Siderurgica is known, added 6.1 percent to 11.16 reais, extending its three-day advance to 16 percent. Vale rose 3 percent to 35.10 reais.

Commodities producers also gained after China disclosed plans on Sept. 6 to build 2,018 kilometers (1,254 miles) of roads, signaling the world’s second-largest economy is stepping up stimulus efforts to revive growth, said Marcelo Varejao, an analyst at Socopa brokerage. Chinese stocks jumped the most in eight months on Sept. 7.

“China’s spending plan was good news for steelmakers and miners,” Varejao said in a phone interview from Sao Paulo. “The external outlook is the main driver for the Bovespa, and investors seem to be more optimistic that policy makers will indeed act to boost the global recovery.”

HRT Tumbles

HRT Participacoes em Petroleo SA, the worst-performing Brazilian oil company this year, tumbled 13 percent to 3.92 reais after U.K.-based Chariot Oil & Gas said it drilled a dry hole in Namibia where HRT has exploration licenses.

The Bovespa has climbed 11 percent from this year’s low on June 5 as eased concern about Europe’s crisis and borrowing costs at a record low in Brazil boosted demand for equities. The index trades at 12.5 times analysts’ earnings estimates for the next four quarters, which compares with the ratio of 10.9 times for MSCI Inc.’s measure of 21 developing nations’ equities, data compiled by Bloomberg show.

Trading volume was 8.13 billion reais ($4.02 billion) in stocks in Sao Paulo today, data compiled by Bloomberg show. That compares with a daily average of 7.16 billion reais this year through Sept. 6, according to data compiled by 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 at papadopoulos@bloomberg.net

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