Ibovespa Rises to 16-Month High as Election Poll Buoys Petrobras

The Ibovespa climbed to a 16-month high as a voter poll indicating dimmed prospects for President Dilma Rousseff lifted shares of state-run companies.

Oil producer Petroleo Brasileiro SA rose for a ninth day in its longest rally since October 2009. BB Seguridade Participacoes SA, Banco do Brasil SA’s insurance unit, was the best performer on the MSCI Brazil/Financials index. Gol Linhas Aereas Inteligentes SA gained after Bank of America Corp. raised its recommendation on the airline to buy.

The Ibovespa advanced 1.1 percent to 57,633.92 at the close of trading in Sao Paulo, the highest since March 2013. Stock options traded on the BM&FBovespa expired today, moving 4.3 billion reais ($1.9 billion), according to data from the exchange. Rousseff would tie with Aecio Neves in a second round of October’s presidential election, according to a Sensus poll released July 18.

“Investors are watching polls very closely,” Joao Pedro Brugger, who helps oversee 520 million reais as a portfolio manager at Leme Investimentos, said by phone from Florianopolis, Brazil. “And not only state-run companies are affected by the polls. People are betting that a new government may be able to implement more successful policies to strengthen the economy as a whole.”

Economists reduced their 2014 growth forecast to 0.97 percent from 1.05 percent a week earlier, according to the median of about 100 estimates in central bank survey published today. That was the lowest estimate since the data started being published.

Petrobras Rallies

Petrobras, as Petroleo Brasileiro SA is known, climbed 1.9 percent to 20.90 reais. Banco do Brasil added 2.3 percent to 28.88 reais. BB Seguridade rallied 3.2 percent to 33.81 reais.

The Ibovespa has surged 28 percent from this year’s low on March 14 as Petrobras jumped on speculation a change in government will reduce intervention in state-owned companies.

Gol climbed 2.8 percent to 13.33 reais.

Homebuilder EZ Tec Empreendimentos e Participacoes SA dropped 3.6 percent to 23 reais. A measure of sales tumbled 47 percent in the second quarter.

Trading volume of stocks in Sao Paulo was 7.05 billion reais today, according to data compiled by Bloomberg. That compares with a daily average of 6.54 billion reais this year, 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 editors responsible for this story: Brendan Walsh at bwalsh8@bloomberg.net Rita Nazareth

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