Brazil's stock market seesawed near the unchanged mark on Friday as concerns over the US economy weighed on banking shares, while take-over talks boosted the shares of phone companies Oi and Brasil Telecom. The Bovespa index of the Sao Paulo Stock Exchange was up 0.01 percent to 60,765.47 points, weighed down by shares of Banco do Brasil.
Yield spreads of Brazil's overseas bonds over comparable US Treasuries as measured by J.P. Morgan's index rose sharply, reflecting an increase in investors' risk aversion toward Brazilian assets. The index showed the country's bond spread widened by 7 points to 280.
Interest-rate futures at the BM&F commodities and futures exchange in Sao Paulo were mostly lower after Brazil's broadest inflation measure, the IGP-M index, rose less than analysts expected. On the local stock market, oil giant Petrobras lost 0.68 percent to 72.61 reais, tracking a 2.3 percent decline in crude prices in New York and 1.5 percent drop in London. Brazil's biggest phone company, Oi Participacoes, surged 6 percent to 45.50 reais and smaller rival Brasil Telecom gained 6.3 percent to 22.59 reais.
Oi reached an agreement to buy Brasil Telecom for an undisclosed sum and a formal agreement should be announced next week, an Oi spokesman said. Reports in local newspapers valued the deal at between 4.5 billion reais ($2.58 billion) and 8 billion reais.
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