Ibovespa Rises as BRF Gains After Earnings Top Forecasts

The Ibovespa advanced, paring a fourth monthly decline, as BRF SA (BRFS3) rose to a record after the Brazilian poultry exporter’s quarterly earnings exceeded analysts’ estimates.

Embraer SA (EMBR3) gained after the planemaker said it will sell jets valued at $840 million to United Continental Holdings Inc., the world’s largest airline. Cia. Brasileira de Distribuicao Grupo Pao de Acucar dropped after the retailer posted first- quarter earnings that trailed forecasts.

The Ibovespa climbed 0.8 percent to 55,312.15 at 12:05 p.m. in Sao Paulo. Forty-nine stocks gained on the benchmark while 19 fell. The measure is down 2.1 percent this month, extending this year’s slump to 9.5 percent. The real rose 0.3 percent to 2.0007 per dollar today.

“Companies such as BRF reported good figures, which is making investors more optimistic about equities,” Henrique Kleine, the head analyst at Magliano SA brokerage, said by phone from Sao Paulo. “The latest earnings reports could be signaling that companies are doing better this year, and maybe in 2013 things will be better than they were last year.”

Half of the 18 companies on the Ibovespa that have already reported first-quarter earnings beat estimates, according to data compiled by Bloomberg.

BRF posted net income of 358.5 million reais in the first quarter, which compares with an average estimate among analysts of 277.9 million reais, data compiled by Bloomberg show. Shares jumped 2.7 percent to 49.20 reais, the highest since the stock started trading in 1997.

Embraer Deliveries

Embraer jumped 5.9 percent to 17.39 reais. The Sao Jose dos Campos, Brazil-based company will start delivering 76-seat E-175 jets to United in 2014, according to the airline.

Pao de Acucar fell 3 percent to 107.20 reais.

Brazil’s benchmark equity gauge trades at 11.2 times analysts’ earnings estimates for the next four quarters, compared with 10.6 for the MSCI Emerging Markets Index of 21 developing nations’ equities, data compiled by Bloomberg show.

Trading volume for stocks in Sao Paulo was 9.13 billion reais yesterday, which compares with a daily average of 7.66 billion reais this year through April 26, 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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