Brazil's Real, Stocks Climb on Export View as Commodities Rise

  • Petrobras, Vale contribute most to Ibovespa's advance
  • Raw materials help currency, equity index trim weekly drop

The real and the Ibovespa rose, trimming weekly declines, as an advance in commodities improves the outlook for Brazilian exports.

The currency gained 0.1 percent to 3.5317 per dollar and the benchmark equity index climbed 0.4 percent to 52,869.09 at 11:48 a.m. in Sao Paulo as metals and crude advanced. Raw materials account for half of the nation’s exports, and producers make up 24 percent of the Ibovespa’s weighting.

"We’ve seen commodities influencing a lot Brazil’s markets lately," Paulo Figueiredo, an economist at asset management firm FN Capital in Petropolis, Brazil.

State-controlled oil producer Petroleo Brasileiro SA and miner Vale SA contributed the most to the Ibovespa’s gain on Friday. The Bloomberg Commodity Index climbed for the first time in five days.

The Brazilian currency is up 11 percent this year and the Ibovespa, 20 percent, amid wagers President Dilma Roussefff will be impeached and that a new administration will be better positioned to tackle inflation, bolster business confidence and get the economy growing again. If a simple majority of senators vote against Rousseff next week -- as analysts widely expect -- she must step down for as long as 180 days and stand trial. In that case, Vice President Michel Temer, who has pledged to put the economy back on track, would take over.

Swap rates on the contract maturing in January 2017, a gauge of expectations for interest rates, rose 0.015 percentage point to 13.695 percent as consumer inflation accelerated more than all analysts forecast in April. The benchmark IPCA consumer price index rose 0.61 percent from 0.43 percent the previous month. Annual inflation slowed for a third straight month to 9.28 percent.

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