Petroleo Brasileiro SA, the world’s most-indebted oil producer, paced gains in the Ibovespa on plans to list its fuel unit as it seeks to raise cash.
Shares of Petrobras extended this year’s surge to 23 percent after also saying that other options include finding a strategic partner for the business. A 49 percent stake in Petrobras Distribuidora SA would be worth as much as $4.7 billion, Bank of America Corp. wrote in a research report.
“That’s very good news for Petrobras, as the company is trying to improve its financial situation and regain investors’ trust,” Fernando Goes, an analyst at brokerage Clear Corretora, said in a phone interview from Sao Paulo. “The managers have talked about the plan a lot, so it’s good to see the intentions becoming reality.”
Petrobras is focusing on exploration and production, scaling back investment in refineries that have become the subject of Brazil’s biggest corruption scandal at a time of slumping crude prices. The company this week announced a plan to cut spending and output targets, while boosting expected asset sales to $15.1 billion for 2015 and 2016.
The Ibovespa added 0.7 percent to 53,106.19 at the close of trading in Sao Paulo, bringing this year’s gain to 6.2 percent. Petrobras rose for the first time in four days.
The oil producer also advanced after Folha de S.Paulo newspaper reported that Petrobras doesn’t rule out an increase in gasoline prices this year, citing Chief Executive Officer Aldemir Bendine. Separately, O Globo newspaper said the company will boost gas prices by an additional 11 percent, bringing the total raise since May to 23.5 percent.
In addition to Petrobras’s rally, Brazilian stocks gained after data showed that industrial output unexpectedly increased as President Dilma Rousseff’s government works to revive an economy headed for its worst recession in 25 years.
“It’s positive that the manufacturing is doing better than everybody expected,” Zeina Latif, the chief economist at brokerage XP Investimentos, said in a phone interview from Sao Paulo. “Still, we’ve got to wait and see how things will play out over the next few months. The deceleration hasn’t reached the bottom yet.”
The Ibovespa has tumbled 8.5 percent from this year’s high on speculation that Latin America’s largest economy will slow further. The benchmark stock gauge had entered a bull market in April, after rallying more than 20 percent from this year’s low, on bets government measures would help shore up the budget and avoid a credit rating downgrade.
Trading volume of equities in Sao Paulo was 5.67 billion reais ($1.83 billion), data compiled by Bloomberg show. That compares with a daily average of 6.89 billion reais this year, according to the exchange.