Bovespa Rises as Consumer Stock Gains Outweigh Producer Declines

The Bovespa (IBOV) index advanced as consumer stocks rallied, outweighing declines by Brazilian raw- material producers.

B2W Cia. Global do Varejo led gains by companies that depend on domestic demand after data from the central bank signaled the Brazilian economy expanded in November at a faster pace than analysts had forecast. Cia. de Bebidas das Americas advanced to a record as the MSCI Brazil/Consumer Staples Index rose the most among 10 industry groups. Steelmaker Usinas Siderurgicas de Minas Gerais SA tumbled for a second day as metal prices dropped.

The Bovespa rose 0.1 percent to 61,787.35 at the close of trading in Sao Paulo. Thirty-five stocks advanced on the measure while 29 fell. The real slid 0.3 percent to 2.0424 per dollar. The central bank held the benchmark lending rate at a record low 7.25 percent after the market closed.

A rally at the end of the session “was probably people building positions in the last minutes of trading in anticipation of the central bank decision,” Elton Marques, an equity trader at HSBC Bank Brasil SA. “The index was negative for most of the day.”

Brazil’s seasonally adjusted economic activity index, a proxy for gross domestic product, rose 0.4 percent in November from October, the country’s central bank said today. The number was higher than predicted by all but 3 of 26 analysts surveyed by Bloomberg, whose median estimate was for a 0.2 percent rise. The gauge rose 2.76 percent from a year earlier.

B2W, EZ Tec

B2W rose 4 percent to 15.86 reais. AmBev, as Bebidas das Americas is also known, advanced 2 percent to 90.40 reais. Fashion retailer Cia. Hering jumped 3.3 percent to 38 reais, the steepest one-day gain since Nov. 1.

Homebuilder EZ Tec Empreendimentos e Participacoes SA jumped 2.3 percent to 26.93 reais after selling a building to Sao Carlos Empreendimentos e Participacoes SA for 564 million reais.

The Bovespa earlier slid as much as 0.8 percent as commodities exporters tumbled after the World Bank projected that the global economy will expand 2.4 percent, down from a June forecast of 3 percent, after growing 2.3 percent in 2012. It lowered its estimate for this year’s economic expansion in Brazil to 3.4 percent from 4.2 percent, according to its twice- yearly report.

Usiminas, as Usinas Siderurgicas is also known, slipped 1 percent to 12.20 reais. Competitor Cia. Siderurgica Nacional SA fell 0.2 percent to 12.44 reais. The Bloomberg Base Metals 3- Month Price Commodity Index lost 0.6 percent.

Brazil Growth

The Bovespa entered a bull market on Jan. 3 after rising 21 percent from last year’s low on June 5 as stimulus from central banks around the world eased concern that economic growth might miss expectations while borrowing costs at a record low in Brazil boosted equity demand. The index has since pared its gain to 18 percent.

Brazil’s benchmark equity gauge trades at 11.2 times analysts’ earnings estimates for the next four quarters, compared with 10.9 for MSCI’s measure of 21 developing nations’ equities, data compiled by Bloomberg show.

Trading volume was 5.91 billion reais in stocks in Sao Paulo today, according to data compiled by Bloomberg. That compares with a daily average of 7.25 billion reais in 2012, according to data compiled by the exchange.

To contact the reporters on this story: Ney Hayashi in Sao Paulo at ncruz4@bloomberg.net; Eduardo Thomson in Santiago at ethomson1@bloomberg.net

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

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