Ibovespa Climbs as Gain in Crude Boosts Prospects for Petrobras

The Ibovespa rose for a third straight day, the best rally in a month, as a gain in crude oil improved the outlook for Petroleo Brasileiro SA’s investments in offshore projects.

The state-run oil producer, known as Petrobras, extended a three-day rally to 16 percent and contributed the most to the benchmark stock index’s advance. Homebuilder Rossi Residencial SA jumped the most on the gauge, paring a fourth month of losses. Airline Gol Linhas Aereas Inteligentes SA fell.

The Ibovespa added 1.5 percent to 50,889.81 at the close of trading in Sao Paulo as 52 of its 70 stocks gained. Oil rallied after data showed the U.S. economy expanded at the fastest pace in more than a decade in the third quarter. Petrobras, which accounts for 7.8 percent of the benchmark equity gauge, rebounded after a probe into alleged bribery of company executives sent the stock to the lowest level since 2004.

“Petrobras has been following crude movements lately, and now we see investors who think the shares are just too cheap,” Alvaro Bandeira, who helps oversee 248 million reais ($92 million) at asset management firm Orama, said in a phone interview from Rio de Janeiro. “The stock market should remain very volatile these days since trading is typically slower than the average by the end of the year.”

Trading volume of equities in Sao Paulo was 4.8 billion reais ($1.8 billion) today, according to data compiled by Bloomberg. That compares with a daily average of 7.3 billion reais this year, according to the exchange. The gauge’s 90-day volatility rose to 33.93 percent last week, the highest level in three years, according to data compiled by Bloomberg.

Petrobras added 6.3 percent to 10.97 reais. Rossi rose 28 percent to 3.29 reais, paring its decline in December to 14 percent. Gol dropped 2.9 percent to 14.27 reais.

The benchmark stock index entered a bear market Dec. 12 after falling 22 percent from this year’s high in September. The gauge has risen 6 percent since then.

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