The Bovespa stock index rose amid speculation that the Federal Reserve will take further measures to stimulate growth for the second-biggest buyer of Brazil’s exports, overshadowing higher inflation forecasts.
OGX Petroleo & Gas Participacoes SA, the oil company controlled by Brazilian billionaire Eike Batista, rose for the first time in three days after UBS AG recommended buying the stock. BM&FBovespa SA, the operator of the Sao Paulo exchange, headed to the highest close in two weeks after Bank of America Corp. said it will benefit from increased stock inflows after Petroleo Brasileiro SA’s record $70 billion share sale.
The Bovespa gained 0.1 percent to 70,907.69 at 9:42 a.m. New York time. Two stocks rose on the index for each that fell. The real strengthened 0.1 percent to 1.6642 per dollar. The market will be closed tomorrow for a holiday.
The Fed will buy as much as $65 billion in Treasuries a month as it attempts to stem U.S. job losses, Mansoor Mohi- uddin, head of global currency strategy at UBS AG, wrote in a report.
Brazil’s consumer prices will rise this year and next more than analysts previously expected, according to a central bank survey, adding to pressure for policy makers to resume interest- rate increases early next year.
Inflation
Inflation will quicken to 4.98 percent in 2011, up from a week-earlier forecast of 4.92 percent, according to the median forecast in an Oct. 8 central bank survey of about 100 economists published today. For 2010, prices will rise 5.15 percent by year-end, compared with a week earlier forecast of 5.07 percent, the survey shows.
OGX gained 0.8 percent to 22.99 reais after being initiated with a “buy” rating at UBS, which said the stock price only reflects half of the company’s exploration potential. OGX is more attractive than state-controlled oil producer Petrobras because it’s more “leveraged” to oil prices and will suffer less from “political influence,” analyst Lilyanna Yang wrote in a note to clients dated Oct. 8.
BM&FBovespa, the operator of Latin America’s biggest securities exchange, advanced 1.7 percent to 14.80 reais. Petrobras’s stock offering boosted volumes last month, and the company will benefit from “stronger cash equity flows and capital markets activity in Brazil,” Bank of America analyst Jorg Friedemann wrote in a note to clients today.
The Bovespa index trades at 10.6 times analysts’ 2011 earnings estimates, compared with 11 times for the MSCI Emerging Markets Index of 21 developing nations’ stocks and 14.3 times for Mexico’s IPC index, according to weekly data compiled by Bloomberg. The Bovespa trades at 15.3 times the reported profits of its companies.
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OGX Petroleo & Gas Participacoes SA, the oil company controlled by Brazilian billionaire Eike Batista, rose for the first time in three days after UBS AG recommended buying the stock. BM&FBovespa SA, the operator of the Sao Paulo exchange, headed to the highest close in two weeks after Bank of America Corp. said it will benefit from increased stock inflows after Petroleo Brasileiro SA’s record $70 billion share sale.
The Bovespa gained 0.1 percent to 70,907.69 at 9:42 a.m. New York time. Two stocks rose on the index for each that fell. The real strengthened 0.1 percent to 1.6642 per dollar. The market will be closed tomorrow for a holiday.
The Fed will buy as much as $65 billion in Treasuries a month as it attempts to stem U.S. job losses, Mansoor Mohi- uddin, head of global currency strategy at UBS AG, wrote in a report.
Brazil’s consumer prices will rise this year and next more than analysts previously expected, according to a central bank survey, adding to pressure for policy makers to resume interest- rate increases early next year.
Inflation
Inflation will quicken to 4.98 percent in 2011, up from a week-earlier forecast of 4.92 percent, according to the median forecast in an Oct. 8 central bank survey of about 100 economists published today. For 2010, prices will rise 5.15 percent by year-end, compared with a week earlier forecast of 5.07 percent, the survey shows.
OGX gained 0.8 percent to 22.99 reais after being initiated with a “buy” rating at UBS, which said the stock price only reflects half of the company’s exploration potential. OGX is more attractive than state-controlled oil producer Petrobras because it’s more “leveraged” to oil prices and will suffer less from “political influence,” analyst Lilyanna Yang wrote in a note to clients dated Oct. 8.
BM&FBovespa, the operator of Latin America’s biggest securities exchange, advanced 1.7 percent to 14.80 reais. Petrobras’s stock offering boosted volumes last month, and the company will benefit from “stronger cash equity flows and capital markets activity in Brazil,” Bank of America analyst Jorg Friedemann wrote in a note to clients today.
The Bovespa index trades at 10.6 times analysts’ 2011 earnings estimates, compared with 11 times for the MSCI Emerging Markets Index of 21 developing nations’ stocks and 14.3 times for Mexico’s IPC index, according to weekly data compiled by Bloomberg. The Bovespa trades at 15.3 times the reported profits of its companies.
http://jodnet.blogspot.com
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