Brazilian Stocks Lead World Equity Gains as Petrobras Advances

  • Advance in raw materials improves the outlook for exporters
  • Investors await results of British EU membership referendum

The Ibovespa led gains among the world’s biggest stock markets as commodities from iron ore to crude advanced, improving the outlook for Brazil’s raw-materials producers.

State-controlled oil giant Petroleo Brasileiro SA was one of the biggest contributors to the benchmark equity index’s advance after U.S. crude stockpiles dropped, sending prices toward $50 a barrel. Steelmakers Cia. Siderurgica Nacional SA and Usinas Siderurgicas de Minas Gerais SA rallied. Materials companies account for 22 percent of the Ibovespa’s weighting.

Brazilian stocks joined global gains Thursday as investors awaited the outcome of a U.K. referendum on whether to remain in the European Union. Equity trading volumes in Brazil were about 6 percent below the five-day average for this time of day, signaling that traders remain cautious ahead of the decision.

"The Brexit vote is making the markets hold their breath, but the tone is very positive today with commodities and producers advancing," Paulo Henrique Amantea, an analyst at the brokerage Guide Investimentos, said from Belo Horizonte, Brazil. "After this matter is over, everybody will be able to take more positions."

The Ibovespa added 2.8 percent to 51,559.82 on Thursday in its biggest gain since May 10. The oil producer known as Petrobras rose 3.5 percent. Vale SA, the world’s largest iron-ore producer, added 5.1 percent, while Usiminas advanced 3.3 percent. Power utility Centrais Eletricas Brasileiras SA surged 10 percent to the highest price since November 2012.

Brazil’s benchmark equity index is trading at 11.9 times estimated earnings, above its five-year average ratio of 10.8 percent.

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