Ibovespa Leads Gains as Support to Oust Brazil's President Grows

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  • Lender Itau contributes most to benchmark index's gain
  • Newspaper reports Rousseff losing support among lawmakers

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Brazil’s Ibovespa rose the most among the biggest global benchmarks on speculation there’s increasing support to impeach President Dilma Rousseff, potentially clearing the way for a new government that would restore growth and shore up the budget.

Lenders Itau Unibanco Holding SA and insurer BB Seguridade Participacoes SA contributed the most to the gauge’s advance. Petrochemicals maker Braskem SA rose the most in three weeks after announcing the start of operations of a unit in Mexico. Raw-materials producers including miner Vale SA followed a decline in commodity prices. Logistics operator Rumo Logistica Operadora Multimodal SA was the worst performer on the Ibovespa after newspaper Valor Economico reported, without saying how it got the information, that an arbitration tribunal will tell the company to pay 300 million reais ($81.4 million) to its client Agrovia SA.

A measure of volatility of Brazil’s benchmark equity index is at the highest in 15 months as investors watch developments in a political crisis and corruption scandal that has brought congress to a standstill and exacerbated the country’s recession and fiscal woes. As lawmakers discuss a request to oust Rousseff over government accounting, newspaper O Estado de S.Paulo reported Thursday that there are 271 votes for impeachment, 112 against, 66 lawmakers who are undecided and 64 who didn’t answer. The count yesterday was 234 votes for, 110 against.

"Investors have been betting that a new federal administration will be able to revive the economy,” Paulo Henrique Amantea, an analyst at brokerage Picchioni, said from Belo Horizonte. “We expect a lot of ups and downs until the final conclusion is reached."

The Ibovespa gained 0.9 percent to 48,513.10 at the close of trading in Sao Paulo as 40 of its 61 stocks climbed. Itau advanced 1.1 percent, BB Seguridade added 3.4 percent and Braskem rose 6.2 percent. Vale fell 1.3 percent and Rumo slumped 17 percent.

Brazil’s stocks have gained 12 percent in 2016 on speculation that a change in government is likely. Those bets got a boost Thursday after newspaper Folha de S.Paulo reported executives of builder Andrade Gutierrez SA said in plea bargain that the funds they legally donated to Rousseff’s campaigns in 2010 and 2014 were derived from bribes.