Brazilian shares rose again this December 3. Brazil’s market ended at a fresh high on U.S. employment news, lower oil prices and optimism regarding the local economy. Brazil’s benchmark Bovespa Index gained 267.57 points, or 1.06%.
In the U.S., non-farm payrolls grew by 112,000 in November following a 303,000 increase the prior month. The latest payroll increase fell short of the 200,000 gain predicted on the Street. Also, September and October payroll figures were downwardly revised.
Brazilian stocks climbed to a new record close, as the weak U.S. jobs data eased concerns over aggressive interest rate hikes by the Federal Reserve. Higher U.S. interest rates tend to draw investments away from emerging markets, such as Brazil.
Also, rate hikes could help halt the dollar’s slide against major currencies, which has benefited Brazilian shares. Additionally, continued declines in global oil prices added support, as Brazil is a net oil importer.
Taking advantage of the disappointing U.S. payrolls release, which inspired a rally in the emerging debt market, Brazil launched another US$ 500 million of its global bond due to mature in 2014. The re-sale added to a previous US$ 750 million 10-year issue made in July.
Turning to economic news, the University of São Paulo (USP, Universidade de São Paulo) said consumer inflation in Brazil’s largest city eased in November.
The Fipe (Fundação Instituto de Pesquisas Econômicas) inflation index rose 0.56%, down from the 0.60% increase in October, as food prices, which have the heaviest weighting in the index, declined.
The November result was in line with forecasts, in a range from 0.50% to 0.60%.
Thomson Financial Corporate Group