The Bovespa index climbed to a one-week high as Gerdau SA led a rally in Brazilian steelmakers spurred by speculation that a surge in U.S. home sales will bolster demand for metals.
Cia. Siderurgica Nacional SA rose for a second day. Iron-ore producer Vale SA contributed the most to the benchmark’s gain. Coal producer CCX Carvao da Colombia SA rallied as controlling shareholder Eike Batista filed a request with regulators to buy outstanding shares and delist the stock. Petroleo Brasileiro SA sank after Grupo BTG Pactual cut its recommendation to hold.
The Bovespa added 0.6 percent to 56,948.87 at the close of trading in Sao Paulo. Forty-five stocks advanced on the gauge while 23 fell. The Bloomberg Base Metals 3-Month Price Commodity Index rose 0.2 percent after a Commerce Department report showed U.S. home sales soared 15.6 percent in January, exceeding the highest estimate of economists surveyed by Bloomberg.
“There are signs that things are getting better in the U.S., and that helps to push the Bovespa a bit higher,” Alvaro Bandeira, a partner at Orama Asset Management, said by phone from Rio de Janeiro.
Gerdau advanced 3.3 percent to 16.80 reais. CSN, as Cia. Siderurgica is known, climbed 2.1 percent to 10 reais. Vale rose 2.5 percent to 35.15 reais.
CCX added 2.3 percent to 4.01 reais.
Petrobras, as state-controlled Petroleo Brasileiro is also known, slid 1.2 percent to 16.74 reais.
The Bovespa earlier dropped as much as 1 percent on concern that Europe’s debt crisis will damp global growth after partial election results in Italy indicated former Prime Minister Silvio Berlusconi may have garnered enough support to deny victory to Pier Luigi Bersani, who campaigned to maintain the austerity program of outgoing Prime Minister Mario Monti.
“Investors are concerned that these results may worsen Italy’s situation,” Felipe Rocha, an analyst at brokerage Omar Camargo, said by phone from Curitiba, Brazil.
Water utility Cia. de Saneamento de Minas Gerais rose 0.2 percent to 48.90 reais after reporting that profit beat analysts’ estimates in the fourth quarter. Adjusted net income jumped 20 percent to 124.8 million reais in the three months through December, data compiled by Bloomberg show. That compares with an average estimate of 108.6 million reais among six analysts surveyed by Bloomberg.
The Bovespa has lost 10 percent from this year’s high on Jan. 3 while the MSCI BRIC Index of shares in Brazil, Russia, India and China slid 4.9 percent over the same period. Brazil’s benchmark equity gauge trades at 11.2 times analysts’ earnings estimates for the next four quarters, compared with 10.4 for the MSCI Emerging Markets Index of 21 developing nations’ equities, according to data compiled by Bloomberg.
Trading volume for stocks in Sao Paulo was 8.24 billion reais today, data compiled by Bloomberg show. That compares with a daily average of 7.5 billion reais this year, according to data compiled by the exchange.