Ibovespa Erases Advance as Investors Weigh Political OutlookDenyse Godoy and Ney Hayashi
The Ibovespa snapped two days of gains, ending little changed, as investors awaited new voter polls to gauge Brazil’s political outlook.
Utility Companhia Energetica de Minas Gerais was the worst performer on the gauge. State-run oil producer Petroleo Brasileiro SA jumped on speculation a change in the country’s administration will reduce intervention in the company.
The Ibovespa was little changed at 59,108.19 at the close of trading in Sao Paulo. The gauge, which briefly extended gains after the U.S. Federal Reserve issued a statement on monetary policy, pared its advance with emerging-market stocks. Brazil’s benchmark equity index has jumped 31 percent from this year’s low in March on bets that a new administration will take measures to boost the economy.
“Stocks will continue trading based on the surveys,” Henrique Kleine, head equity analyst at brokerage Magliano SA, said in a phone interview from Sao Paulo.
The latest Ibope poll showed a runoff between President Dilma Rousseff and opposition candidate Marina Silva is too close to call, while backing for third-place candidate Aecio Neves increased. Rousseff would win 36 percent of voter support in the first round, with 30 percent for Silva and 19 percent for Neves, according to the survey. The results compare with 39 percent for Rousseff, 31 percent for Silva and 15 percent for Neves in a Sept. 12 Ibope poll.
Datafolha could release a new poll as soon as tomorrow, according to the website of electoral authorities.
The Ibovespa gained as much as 1.5 percent earlier today after the Fed maintained its commitment to keep interest rates near zero for a “considerable time” after asset purchases are completed, saying the economy is expanding at a moderate pace and inflation is below its goal.
Policy makers tapered monthly bond buying to $15 billion in their seventh consecutive $10 billion cut, staying on course to end the program in October. Bond purchases intended to hold down long-term interest rates have swelled the Fed’s balance sheet to $4.42 trillion.
Petrobras climbed 2.6 percent to 22.12 reais. Companhia Energetica de Minas Gerais slumped 6.5 percent to 15.85 reais.
Trading volume of equities in Sao Paulo was 8.13 billion reais today, according to data compiled by Bloomberg. That compares with a daily average of 6.78 billion reais this year, according to the exchange.