Brazil’s Stocks Rise Eighth Week as Vale Climbs With Commodities

  • Miner and steelmaker join global rally on iron ore prices
  • U.S. labor data fuel optimism regarding U.S. economy

The Ibovespa advanced for an eighth straight week, the longest winning streak since 2009, as miner Vale SA and steelmakers including Gerdau SA followed commodities higher on Friday.

The benchmark index swung between gains and losses during the day as iron-ore price increases bolstered the outlook for producers of the raw material, while state oil giant Petroleo Brasileiro SA declined. Better-then-expected jobs data in the U.S. fueled optimism on growth in the world’s biggest economy. For-profit college manager Ser Educacional SA climbed to the highest since January after quarterly profit exceeded estimates.

The local equity gauge has advanced 65 percent in dollar terms this year, the biggest gain among major benchmarks worldwide, as improved prospects for Brazilian companies that rely on exports added to bets that a new government will be able to restore growth in Latin America’s biggest economy.

"The mood in Brazil’s market has been very optimistic in recent weeks with a better outlook for exporters and speculation over the recovery plan," said Luis Gustavo Pereira, an analyst at the brokerage Guide Investimentos in Sao Paulo. "A strong U.S. is positive for us, and gains in commodities always help our companies."

The Ibovespa rose 0.1 percent to 57,661.14 at the close of trading in Sao Paulo, extending this week’s gain to 0.6 percent. Vale added 0.9 percent, as iron ore gained and people familiar with the talks said the company is nearing an agreement to sell its entire fertilizer business. Gerdau climbed 3.9 percent, and Ser rose 3.5 percent. Petrobras fell 3 percent.

Brewer Ambev SA rose the most in four months as Finance Minister Henrique Meirelles said business and consumer confidence has rebounded, according to Valor Economico newspaper.

Latin America’s biggest economy is forecast to shrink 3.4 percent this year after contracting 3.8 percent in its worst recession in a century. Vice President Michel Temer temporarily replaced Dilma Rousseff as the head of the nation in May while she faces an impeachment trial for allegedly breaking budget laws. The final decision by the Senate on the presidency is expected at the end of the month.

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