Ibovespa Leads World Gains on Better-Than-Forecast Economic Data

The Ibovespa led gains among major equity indexes as better-than-forecast economic data in Brazil bolstered the outlook for companies that depend on local demand.

Lender Banco Bradesco SA contributed the most to the gauge’s advance. For-profit college operator Kroton Educacional SA rallied on bets the Education Ministry will announce changes in the student loan known as Fies. Natura Cosmeticos SA sank as earnings trailed estimates.

The Ibovespa rose 2.7 percent to 49,532.72 at the close of trading in Sao Paulo. The seasonally adjusted economic activity index, a proxy for gross domestic product, fell 0.55 percent in December from a month earlier, the central bank reported. The median forecast of 32 economists surveyed by Bloomberg was for a decline of 0.85 percent.

“That’s a little better than expected, and Brazilian companies have already adjusted their operations for a weak year,” Alvaro Bandeira, who oversees 248 million reais ($86 million) at Orama Asset Management in Rio de Janeiro, said in a telephone interview.

Bradesco climbed 4 percent to 35.65 reais. Cosmetics maker Natura lost 6.9 percent to 27 reais.

The Ibovespa also joined a rally in emerging markets as Russia and Ukraine reached an agreement for a cease-fire after all-night talks in Minsk, Belarus.

“The mood on international markets is very positive today, and that’s also helping Brazilian stocks,” Bandeira said.

Petrobras Rises

State-controlled oil producer Petroleo Brasileiro SA followed crude higher, adding 5.2 percent to 9.50 reais. West Texas Intermediate for March delivery jumped 4.4 percent to $51.01 a barrel on the New York Mercantile Exchange. Petrobras, as the company is known, has said its offshore output investments are viable with oil prices at $45 a barrel.

Kroton advanced 14 percent to 10.99 reais, a record gain. Education Minister Cid Gomes said on Wednesday that the government is in talks with the Financing and Planning ministries and state-controlled lender Banco do Brasil SA about Fies rules.

The benchmark stock index entered a bear market Dec. 12 after falling 22 percent from last year’s high in September. Trading volume of equities in Sao Paulo was 6.7 billion reais Thursday, according to data compiled by Bloomberg. That compares with a daily average of 6.5 billion reais this year, according to the exchange.

Before it's here, it's on the Bloomberg Terminal.